Later the steps below Testament own you to figure the care proportion on a no sweat Car loan. To complete this, you Testament exigency to comprehend how yet you borrowed and how still absorption you Testament wages.
A mild loan resources you pament the complete carefulness without regard to the generation it takes to reinstate it. These kinds of loans normally returns community between individuals rather than between a bank and an distinct. You have computed the loan's interest rate, and you created a paper trail showing how you did it.
You need know only add, subtract and do long division. You can do the problems on calculator (recommended) or by hand.
Instructions
The Car Loan Rate Formula
1. Write down the amount you borrowed at the top left of the paper and label it "principal." For example, "principal = $4,500."
2. Write the amount of interest you will pay for the loan on the top right of the page and label it "total interest." For example, "total interest = $500."
3. Write this formula in the middle of your page: "Interest rate % = total interest $ / (slash means divided by) principal $."
4. Rewrite the formula under the equation you just wrote, substituting the numbers you have written at the top of your page for "principal" and "total interest." For example, "Interest rate % = $500 / $4,500."
5. Divide the principal into the interest. Write the answer down as a complete formula. For example, "0.11 = $500 / $4,500."
6. Convert the fraction to a percentage by moving the decimal place two numbers to the right. Drop the zeros that now precede the decimal point and add a percentage symbol (for example, "0.11 = $500 / $4,500" becomes "interest rate = 11% = $500 / $4,500"). Write the new formula at the bottom of your formula list. For instance, you borrow $4,500 from a companion to shop for a motorcar and comply to come back $5,000, and you are curious to jewel outside the interest rate.You can use this skill when you borrow money and you and the lender agree on the amount of interest but not the rate, or when you loan someone money, know how much interest you want and need to calculate the interest rate you will have to charge to get it.Computing a simple auto loan interest rate is not difficult.
