What You Should Understand About Alternative Payment Frequencies
When it comes to loan payments, it’s useful to know what the payment amounts would be for each available options – yearly, semi-yearly, quarterly, monthly, bi-monthly, weekly and bi-weekly. From that, you can look at the principal balances. You’ll know what the total amount of payments will be made and how much interest you’ll pay.
Definitions To Keep In Mind
Loan Amount – How much your loan is for.
Payment – The amount of payment you’ll pay on the loan.
Interest Rate – Your yearly interest rate on the loan. This is calculated every period, using the present outstanding balance. The yearly rate is divided by the amount of periods each year.
Interest Paid – This how much interest you’ll pay on a loan, provided you make timely payments, and no repayments have been subjected.
Payment Frequency – How often you’ll make the payments – monthly, semi-monthly, weekly, bi-weekly, quarterly, yearly or semi-yearly.
Number of Payments – How many payments you’ll make in the loan.
Total Payments – The complete number of payments you’ll make on the loan, principal and interest included. This is providing all payments are made in a timely manner and no prepayments of the principal.