Car Loan Amortization Schedule and Its Purposes
If you have car loan, you need schedule template in order to maintain the payment in balance. Furthermore, borrowers must know how much the payment that they should complete. On the other side, lender uses schedule to monitor all loans to ensure everything is in proper condition. One of such schedules is applicable to the car loan. It is called as car loan amortization schedule.
Before exploring further, you should understand few things about this schedule. Firstly, the car loan amortization is similar to other loans where you calculate all payments, interest, and principal comprehensively. It uses timeline, such as weekly, bi-weekly, and monthly.
In this schedule, you see the amount of payment will be different after you pay the previous one. Next payment is adjusted based on the interest and principal loan. In general, you pay less because some portions of loan are already paid.
Purposes of Car Loan Amortization Schedule
Car loan amortization schedule has two basic functions. Below list explains why most people use this schedule. In fact, the bank and other lenders also calculate amortization for car loan.
- Money management
You are familiar with term of time value of money. You have money today and do not spend them. After one year, the money is still at the same amount but the value is decreased. That’s why amortization seems at he same amount of money every time you pay. Money management is the reason why people use this schedule.
- Avoid delay or late payment
In schedule, you see the timeline including the date. When choosing monthly schedule, borrower must complete the payment on time. You know due date for each payment. This is useful to avoid delay that makes you pay more fee.
List of Car Loan Amortization Schedule
Schedule is available in several templates. You can choose some of them that will be provided in the following list. As you know, car loan amortization schedule is for support time to ensure the borrowers pay before due time.
- General amortization schedule
- New car loan schedule
- Used car schedule
- Bi-weekly loan schedule
- Monthly loan schedule
From above list, general schedule is the top choice that’s always capable to fulfill any loan. You can use it for car, mortgage, credit card, even small loan from your friend. This schedule is flexible and you can modify based on your preference.
The rest of schedules are available based on certain category like timeline and car condition. New car has different loan schedule compared to the used one. You will also see the different calculation when using bi-weekly and monthly schedule even though the amount of loan is equal.
Schedule for Car Loan Amortization
Lender usually gives such schedule directly to borrower. You just check and calculate properly on your own. Keep in mind the schedule is subject to change if the loan uses variable interest. On the other hand, this situation is mostly for big loan with volatile situation.
You just download the template and edit it in your computer. The file is in digital form that’s compatible to most of software. As alternative, you can edit the car loan amortization schedule via online app.