Right now i have a 48 month loan (8 months into it). If i wanted to say get a different car 2 years from now the loan would be roughly 1/2 paid off. How would this work out?

For simple math i'll use nice round numbers. 12k left on loan. 8k paid principal. At time of sale car book value would be 16k. Would I only get 4k out of it 16k value - 12k unpaid balance? (seems like a waste paying 8k + int for only 4k in return) Or does my principal paid work in there some where?

Is there a way to say switch from a loan to a lease with the dealership? I'll probably give them a call up next week.

 

Due to interest compounding, your balance won't be quite halfway paid off at the half way point of your loan. But that's also about the point where your payment will go more and more toward the equity rather than the interest.

 

in a 4 year term your interest vs principle payment is very stacked towards interest. you will not be @ 1/2 paid off by end of year 2, however what will happen when you go to buy a new car is they will throw out a value for your car. let say 16k if you still owe, say 9k on a 12k loan you will get 7k put towards the purchase of your new car.

Simple enough?

the amortization table is pretty straight forward, let me build one quick (i am @ work and work in finance) and give you an understanding for the structure of repayment. (if i don't post back soon i got busy sorry)

 

here is the amortization table,

you would pay 1264.88 in interest in 48 months, after 24 payments you would have prinicple around $6500 (keep in mind this is with an interest rate of 5% which easily could be higher or lower depending on what yours is

say your interest rate is 5%, (pretty standard on a used car) and your principle when bought was 12k

pmt # principle interest paid principle paid payment principle after payment
1 $12,000.00 $50.00 $226.35 $276.35 $11,773.65
2 $11,773.65 $49.06 $227.29 $276.35 $11,546.36
3 $11,546.36 $48.11 $228.24 $276.35 $11,318.12
4 $11,318.12 $47.16 $229.19 $276.35 $11,088.93
5 $11,088.93 $46.20 $230.15 $276.35 $10,858.78
6 $10,858.78 $45.24 $231.11 $276.35 $10,627.67
7 $10,627.67 $44.28 $232.07 $276.35 $10,395.61
8 $10,395.61 $43.32 $233.03 $276.35 $10,162.57
9 $10,162.57 $42.34 $234.01 $276.35 $9,928.57
10 $9,928.57 $41.37 $234.98 $276.35 $9,693.58
11 $9,693.58 $40.39 $235.96 $276.35 $9,457.62
12 $9,457.62 $39.41 $236.94 $276.35 $9,220.68
13 $9,220.68 $38.42 $237.93 $276.35 $8,982.75
14 $8,982.75 $37.43 $238.92 $276.35 $8,743.83
15 $8,743.83 $36.43 $239.92 $276.35 $8,503.91
16 $8,503.91 $35.43 $240.92 $276.35 $8,262.99
17 $8,262.99 $34.43 $241.92 $276.35 $8,021.07
18 $8,021.07 $33.42 $242.93 $276.35 $7,778.14
19 $7,778.14 $32.41 $243.94 $276.35 $7,534.20
20 $7,534.20 $31.39 $244.96 $276.35 $7,289.25
21 $7,289.25 $30.37 $245.98 $276.35 $7,043.27
22 $7,043.27 $29.35 $247.00 $276.35 $6,796.26
23 $6,796.26 $28.32 $248.03 $276.35 $6,548.23
24 $6,548.23 $27.28 $249.07 $276.35 $6,299.17
25 $6,299.17 $26.25 $250.10 $276.35 $6,049.06
26 $6,049.06 $25.20 $251.15 $276.35 $5,797.92
27 $5,797.92 $24.16 $252.19 $276.35 $5,545.73
28 $5,545.73 $23.11 $253.24 $276.35 $5,292.48
29 $5,292.48 $22.05 $254.30 $276.35 $5,038.19
30 $5,038.19 $20.99 $255.36 $276.35 $4,782.83
31 $4,782.83 $19.93 $256.42 $276.35 $4,526.41
32 $4,526.41 $18.86 $257.49 $276.35 $4,268.92
33 $4,268.92 $17.79 $258.56 $276.35 $4,010.35
34 $4,010.35 $16.71 $259.64 $276.35 $3,750.71
35 $3,750.71 $15.63 $260.72 $276.35 $3,489.99
36 $3,489.99 $14.54 $261.81 $276.35 $3,228.18
37 $3,228.18 $13.45 $262.90 $276.35 $2,965.28
38 $2,965.28 $12.36 $263.99 $276.35 $2,701.29
39 $2,701.29 $11.26 $265.09 $276.35 $2,436.19
40 $2,436.19 $10.15 $266.20 $276.35 $2,169.99
41 $2,169.99 $9.04 $267.31 $276.35 $1,902.69
42 $1,902.69 $7.93 $268.42 $276.35 $1,634.26
43 $1,634.26 $6.81 $269.54 $276.35 $1,364.72
44 $1,364.72 $5.69 $270.66 $276.35 $1,094.06
45 $1,094.06 $4.56 $271.79 $276.35 $822.27
46 $822.27 $3.43 $272.92 $276.35 $549.34
47 $549.34 $2.29 $274.06 $276.35 $275.28
48 $275.28 $1.15 $275.20 $276.35 $0.08
$1,264.88

 

Yeah, I know all about the amoritization thing. I may not have been clear but the original loan amount is 20k, so i just guessed 8k paid 1/2 through.

Just wanted to know how they determine the value of your car if you still owe on it.

 

They basically just subract the value of the car from the amount owed. Most likely I'll pay it off a year early since I really hate being in debt. Save on some interest.

 

This is a good site that helps me when figuring payments and what not.

http://www.bankrate.com/brm/rate/calc_home.asp

 

cool thanks for that link.

lol, according to that site I can't afford my car now.