can someone explain APR to me?

[Corporate Thug]

ok, i'm planning on taking out a $1500 loan that has 5.99% APR over 48 months. what the hell does this mean? how much do i pay back?

 

[Pacfanweb]

Do a google search for "loan calculator" and you'll find your answer.

 

[LOLyourFace]

Originally posted by: shady06
ok, i'm planning on taking out a $1500 loan that has 5.99% APR over 48 months. what the hell does this mean? how much do i pay back?

errr you're thinking of loaning $1500 but don't know what APR is?

APR stands for Annual Percentage Rate. It's the interest for the loan. Meaning, 5.99% of the principal will be added each year for 4 years (48 mo)

 

[RossMAN]

$35.22 per month x 48 months = $1,690.56 total payments - $1,500 loan amount = $190.56 interest you paid

http://www.interest.com/hugh/calc/missing.cgi

 

[Corporate Thug]

Originally posted by: LOLyourFace

Originally posted by: shady06
ok, i'm planning on taking out a $1500 loan that has 5.99% APR over 48 months. what the hell does this mean? how much do i pay back?

errr you're thinking of loaning $1500 but don't know what APR is?

APR stands for Annual Percentage Rate. It's the interest for the loan. Meaning, 5.99% of the principal will be added each year for 4 years (48 mo)

what if the loan is paid back before the end of the first year?

 

[RossMAN]

Originally posted by: shady06

Originally posted by: LOLyourFace

Originally posted by: shady06
ok, i'm planning on taking out a $1500 loan that has 5.99% APR over 48 months. what the hell does this mean? how much do i pay back?

errr you're thinking of loaning $1500 but don't know what APR is?

APR stands for Annual Percentage Rate. It's the interest for the loan. Meaning, 5.99% of the principal will be added each year for 4 years (48 mo)

what if the loan is paid back before the end of the first year?

I'm assuming it's a simple interest loan, meaning interest accrues every day (not ahead of time, it's all in the present).

So if you borrowed $1,500 today and paid it off in 3 months you would owe $1500 plus 3 months of interest, that's it.

The SOONER you pay it off, the less interest you pay.

 

[RossMAN]

dp

 

[LOLyourFace]

Originally posted by: shady06

Originally posted by: LOLyourFace

Originally posted by: shady06
ok, i'm planning on taking out a $1500 loan that has 5.99% APR over 48 months. what the hell does this mean? how much do i pay back?

errr you're thinking of loaning $1500 but don't know what APR is?

APR stands for Annual Percentage Rate. It's the interest for the loan. Meaning, 5.99% of the principal will be added each year for 4 years (48 mo)

what if the loan is paid back before the end of the first year?

then you'll only pay interest for the first 12 months. 5.99% for 12 months = 5.99/12 = 0.499999% monthly interest added to the principal

[edit] so roughly:
$1500 x 0.49999% = about $7.48 monthly of interest

$7.48 x 12 months = $89.76 annual interest (which is 5.99% of $1500, matches right up)

 

[bunker]

You also have to make sure there are no penalties for prepayment (paying it off early).

Banks are in the business to make $$ and if everyone paid off their loans early they wouldn't make much so a lot of times they'll throw in a penalty for paying it off early.