Why do you need a student loan calculator?
All you need in order to use this student loan calculator is basic information about the student loan you have or you’re looking to get. You pop the numbers in and the calculator shows you exactly what kind of a monthly payment plan you’ll be set up with and how long it will take you to pay back the entire loan.
Most importantly, the calculator will show you how much interest in total you will be paying (that is, the amount of money you will pay simply for the luxury of borrowing this loan). With that said, here are a few basic things we need to cover before you start using a student loan calculator.
Student Loan Calculator
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Calculate the impact of extra payments using any combination of the inputs below. To see your new estimated payoff date, click ‘Show amortization schedule’ link above.
Let’s start with the most important piece of info - the loan amount. This amount of money will be based on your college enrollment level. For instance, if you’re a graduate student you won’t be offered the same amount as an undergraduate student. The loan amount will also depend on whether you’re looking at federal or private lenders. Regardless of how much money you are offered, it’s always best to borrow only the amount you actually need in order to cover your education fees.
Loan term is the amount of time it will take you to repay the entire loan. The standard loan term for federal loans is 10 years. However, you can qualify for alternative payment plans which can offer terms from 10 to 25 years in total. If you’re looking at private lenders, you’ll have more flexible options when it comes to loan terms because private loans can last anywhere from 5 to 20 years.
Interest rates determine how much money you’ll be paying on top of the amount that’s needed to pay back the original sum you borrowed. Naturally, the interest rates will depend on your financial background and the type of lender you choose. The nature of your income along with your credit score will play a big role in determining what your final interest rates are going to be.
Other Factors to Student Loans Should Keep In Mind
There are several other factors you should keep in mind. For instance, there is a difference between fixed and variable rates. A loan with a fixed rate will not change during your entire loan term, whereas a loan with a variable rate may increase or decrease depending on market conditions. The second option might sound like a gamble so be careful when signing up for loans with variable rates.
Moreover, keep in mind that the term length will have an effect on the amount of interest you have to pay. The shorter the term, the lower the interest rate. However, that also means you have to be able to make higher payments on time. Last but not least, keep in mind that private student loans require a credit check. If your credit score is not high enough, your co-signer’s needs to be. Otherwise, you won’t qualify for the loan.