Comparing is helpful, but not always so easy. For example, banks give a debit interest, which does not include all costs. Most fees are therefore only in the APR clear. That’s why it’s even more important to use an online loan calculator. This can show exactly what interest a loan offer holds and what other terms this includes. It is also advantageous here that the loan calculator can be used for all loans and thus can represent a very practical help tool for customers when comparing.
The most important 5 facts about the online loan calculator:
- The interest rate is calculated on the basis of the term, the loan amount and the credit rating.
- An online loan calculator can be used to compare loan offers or calculate interest rates.
- Most loan calculators are available for free.
- When comparing you should always look at the APR and not on the borrowing rate.
- It is recommended to use an online loan calculator, especially if there are many offers to compare.
1. Brief insight into how an online loan calculator works
If you want to start a credit comparison, the online loan calculator can help. Here you first enter his desired loan amount. The lower the loan amount, the higher the fees and the lower the interest rates. This is because editing for small sums takes as much time as large sums. The low interest rates, on the other hand, are possible because there is not too much risk for the banks.
Then you can specify the desired runtime. This also determines the amount of interest. The rule is: If the interest rates are low and the term is high, the loan becomes expensive. The reason is quite simple: when interest rates rise, the bank has no way to increase the interest rate. So she recovers the interest. Conversely, borrowers who have chosen a long maturity during a high yield phase pay lower interest rates.
In addition to these two details often further data, such as the amount of equity, must be disclosed. After all information has been typed in, an interest margin is displayed. For example, this can be 4.5 to 6.1 percent. Unfortunately, you can not find out the exact amount of interest using the online loan calculator. This is because not only the loan amount, the term and the equity influence the interest rate, but also the creditworthiness of the borrower. These usually include the Private credit information, the income and all other debts.
2. When does a loan calculator make sense?
Basically, it can be said that a loan calculator makes sense if you want to take out a loan or a loan. After all, there are many banks and credit institutions that offer bank loans. A bank loan comparison 2019 indicates the cheapest options. So there are also many different conditions and loan offers that can be compared. A loan calculator is helpful here to find out which loan best suits your current situation.
For example, a loan calculator can help you compare mortgage lending
For example, there is a loan calculator for home purchase, which of course can then be used as soon as a property is to be bought or bought. Here you usually take a so-called mortgage loan, through which you can finance the property. In this area alone, there are many different offers that you can easily keep track of with a loan calculator.
3. Compare with the online loan calculator made easy
That a comparison in itself is sometimes not very easy, is probably clear to anyone who has ever gone from bank to bank and there is the offers caught up. Because here you can quickly lose track. In order to save the way to the bank branches, there is the simple possibility of the online loan calculator. Through this one can compare different offers online and quite comfortably from home.
Because there are various offers from various banks and credit institutions, which are well summarized in a comparison. As already described, you only have to give a few details, so that you can see within a short time the right provider including their offers. This offers the benefits of time savings and objective vision.
Avoid too high costs – an online loan calculator leads to cheap loan offers
Another advantage of the loan calculator is that little or no data needs to be provided. Nevertheless, this gives you a small overview, so that you know afterwards how much you would have to pay approximately.
However, one should also note that probably no online loan calculator will display all banks. So our online loan calculator has only 35 providers to choose from.
4. Is a loan calculator free?
Loan calculators are offered in various forms. So there are on the one hand the online loan calculator and on the other hand the download versions. The online loan calculators are mostly tools that then, just like our loan calculator, show a comparison. With download versions, however, you can usually see the repayments for the respective months. Here you have already received a specific loan and would like to know how the repayments are to be paid. However, both versions are usually available for free to everyone.
5. Debit rate and annual percentage rate: where is the difference?
Knowing the difference between the borrowing rate and the annual percentage rate is very important, as it is the only way to keep track of the total cost. The borrowing rate, which used to be called the nominal interest rate, is the loan interest rate. This means that no further costs are included here.
In contrast, the annual percentage rate not only displays the loan interest, but also indicates which additional fees are due. These may be, for example, the processing or agency fees. But additional costs for payments are included here. The statement of the effective annual interest rate for banks is an obligation, which is prescribed by the law. Because the APR allows customers to compare better and so know exactly what costs will be incurred in the year.
However, it must also be mentioned that by far not all costs are included in the effective annual interest rate. This includes, for example, the extra costs for special repayments or for the early repayment of the loan if the bank charges fees for early repayments. In addition, the costs for the residual debt insurance, the account maintenance fees and the estimated costs are not included in the annual percentage rate of charge. In addition, the provisioning interest incurred, for example, on a forward loan, must be calculated separately.
6. The conclusion: a good overview thanks to the loan calculator
Finally, at the end of our guide, we can say that the loan calculator provides a good overview that can be helpful in comparing the various loan offers. It is important to know in advance your equity and the difference between the borrowing rate and the annual percentage rate of charge. Only then can you filter out the cheapest offers through a loan interest comparison. This is important not only in installment loans, but also in real estate financing. Therefore, there are, inter alia, loan calculator with home purchase. Here are the different mortgage loans compared, so you get the best possible conditions. Of course you can also use this calculator when building a property.