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Why use an auto payment calculator

How to use an auto payment calculator

No matter what kind of auto payment calculator you're looking for, you can probably find it at Bankrate.com. You might be looking to see how long it will take you to pay off your loan. Or perhaps you just want to pay off your loan early. There's an auto payment calculator for nearly any question you might have.

The early payoff auto payment calculator, for instance, will show you how much you can save in interest, and how much time you can shave off the life of the loan, by increasing your monthly payment.

Car loans and credit

There's a common misconception that paying off your car loan early affects your credit score. That's completely false. Paying off your car loan, early or on time, doesn't affect your credit score one way or the other. Missing car payments, however, will hurt your credit score.

A car loan home equity calculator tells you if you would save any money by financing your car purchase with a home equity loan instead of a traditional car loan. An auto payment calculator makes even complex calculations simple.

If you're thinking of financing your car with a home equity loan, you might be considering using a home equity line of credit, or HELOC. There are pros and cons when it comes to using a HELOC for that purpose.

One of the advantages of a HELOC is that you can lengthen the time it takes to pay off the loan. You get 10 to 15 years to pay off a HELOC, whereas you typically get three to seven years to pay off a car loan.

Interest only

Another pro of a HELOC is that you can choose to pay only the interest. If money gets tight, that could be a big help.

However, HELOCs usually are variable-interest rate loans. In other words, the interest rate could go up. A problem with using a HELOC to pay off a car is that you'll need to be vigilant about paying off the loan so it doesn't last longer than you actually own the car.

 

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Tara Baukus Mello

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