Although there are many loan payment calculators online, some people have never bothered to use them. This is particularly sad considering the level of financial illiteracy in the United States. According to the National Financial Educators Council (NFEC), fewer than 40% of Americans track their money spending habits. By using a loan calculator, you can gain useful insights that can help you spend money wisely, including the following:
A survey carried out by the National Foundation for Credit Counseling found that 10% of Americans with mortgages miss or make late payments every month. A loan payment calculator would make it easy for a potential borrower to compare different loan options and determine how much money one would need to set aside every month toward mortgage or car loan, for example.
By calculating extra loan repayment figures, a loan calculator enables a borrower to pay back a loan faster and as a result, save some money. This is partly because borrowers who make extra loan payments tend to enjoy lower interest rates over time, according to Dr. Don Taylor, a financial consultant. Of course, most people would be unable to perform such calculations manually.
In summary, a loan payment calculator can benefit both potential and existing loan borrowers as well. For instance, it can help a person to compare accurately different loan options, as well as calculate how much money a borrower would save by making extra loan payments.