Introduction to the loan amortisation calculator

A loan amortisation calculator is a handy tool that helps borrowers better understand their monthly payments, the remaining debt and the interest portion. This tool provides transparency and allows you to make informed decisions about your finances. Whether for a property loan or a personal loan, a repayment calculator is the key to effective credit planning.

How does a repayment calculator work?

A repayment calculator works with basic mathematical formulas to determine the monthly payments and the development of the remaining debt. You enter the data and the calculator automatically generates a detailed overview:

• Interest: Based on the remaining debt and the interest rate.
• Redemption: The amount that flows directly into the loan repayment.
• Residual debt: The remaining loan amount after each payment.

What data is required?

To use an amortisation calculator effectively, you need the following information:

• Loan amount: The total loan you take out.
• Loan term: The repayment period in months.
• Interest rate: The annual interest rate of your loan.
• Monthly instalment: The amount you wish to repay each month.

You can use these values to create realistic scenarios and optimise your credit planning.

Understanding monthly payments

The monthly instalment of a loan consists of two main parts:

• Interest: The share of costs attributable to the utilisation of the borrowed capital.
• Redemption: The amount that reduces the loan.

Over the course of the term, the interest portion decreases while the amortisation portion increases. The residual debt decreases with each payment until it finally reaches zero.

The annuity method explained

The annuity method ensures that your monthly payments remain the same throughout the term of the loan. It works as follows:

• You pay higher interest at the beginning because the remaining debt is still high.
• The residual debt decreases with each payment, whereby the interest portion decreases and the amortisation portion increases.

Why is a repayment plan important?

A repayment plan is a detailed document that shows the progress of your loan repayments. It contains:

• Monthly instalment payments.
• Changes in the residual debt.
• Interest and redemption portions.

With a repayment plan, you retain full control over your finances and can compare different scenarios more easily.

FAQs on the topic of loan amortisation calculator

What is a loan amortisation calculator?

A loan repayment calculator is a tool that calculates the monthly instalments, the remaining debt and the interest burden of a loan.

How can I create a repayment plan?

Use an online repayment calculator to enter the details of your loan and create a plan.

Can I take unscheduled repayments into account?

Yes, many repayment calculators offer the option of including unscheduled repayments to save on interest costs.

For which loans is a repayment calculator suitable?

A repayment calculator is suitable for annuity loans, personal loans and even property loans.

What is the advantage of an online redemption calculator?

It offers fast and precise results without the need for complex calculations.

Are amortisation calculators free of charge?

Most online repayment calculators are free and easy to use.

Conclusion and recommendation

A loan amortisation calculator is an indispensable tool for transparent and efficient loan planning. With annuity loans in particular, you benefit from a clear overview of your payments. Use a repayment calculator to optimally organise your finances and save interest costs in the long term.