Question 1

How is a loan payment calculated?

Accepted Answer

Payment = P*r / (1 - (1 + r)^(-n)), where P is principal, r is monthly rate (APR/12), n months.

Question 2

What is an amortization schedule?

Accepted Answer

A table showing each payment split into interest and principal and the remaining balance over time.

Question 3

Can I include extra payments?

Accepted Answer

Yes—extra monthly or one-off payments reduce interest and shorten payoff time.

Question 4

How do points and fees affect the loan?

Accepted Answer

If financed, they increase principal and interest costs; paying up front lowers total cost.

Question 5

What term should I choose?

Accepted Answer

Shorter terms cost less interest but raise payments; pick the shortest term you can afford comfortably.

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