Definitions of Calculator’s Financial Terms
Loan Amount – Total amount of money you’re looking at borrowing. This would not include the amount of interest you would be paying based on your interest rate.
Payment – The amount of money you have to pay each month (or every week or every two weeks depending on the payment frequency you choose) to pay off the loan.
Interest Rate – The annual interest rate for this personal loan. The interest is calculated for each period (every month, every two weeks, or weekly depending on the payment frequency you’ve chosen) on the remaining balance of the loan.
Number of Payments – The number of times you’ll need to make loan payments on this loan. This could be a weekly or monthly payment, depending on what the amortization schedule determines.
Payment Frequency – You select how often payments are made. The options you can choose are a monthly payment (12 payments per year), bi-weekly (26 payments each year), or weekly (52 payments every year). Note: if you play with the numbers, you’ll see that bi-weekly or weekly payments will pay off your loan more quickly than monthly payments.
Total Interest Paid – This is the full amount of interest you’ll pay on this loan as long as you make all your payments on time, as scheduled, and you don’t prepay any of the principal payments (like with a down payment on a vehicle).
Total Payments – The total amount of all payments on this loan amount, including all interest and principal payments. This amount also assumes that all payments are made as scheduled and no prepayments are made on the principal amount of the loan.