NAME:___________________________________
CALCULATING THE COST OF AN AUTOMOBILE LOAN
Use financial calculators at bankrate.com. In the Auto section find
“Low Interest Auto Financing Calculator” and answer the following:
CHANGING THE DOWN PAYMENT
$7,500 negotiated price, 5% APR, 3 years
Down
Payment
1
2
3
Principle Loan
Amount
Monthly
Payment
Interest Paid
$500
$1,000
$2,500
CHANGING THE APR
$7,500 negotiated price, $2,500 down payment, 3 years
APR
Principle Loan Monthly
Interest Paid
Amount
Payment
1
2
3
Total
Purchasing
Cost
3%
5%
15%
CHANGING THE TIME PERIOD
$7,500 negotiated price, $2,500 down payment, 5% APR
Time Period
Principle Loan Monthly
Interest Paid
Amount
Payment
1
2
Total
Purchasing
Cost
Total
Purchasing
Cost
3 Years
5 Years
SO WHEN GETTING A CAR LOAN, IT SHOULD HAVE THE
__________ DOWN PAYMENT, ____________ APR, AND THE
____________ TIME PERIOD YOU CAN AFFORD.
3 YEAR NEW CAR LOAN
1
2
PRINCIPAL
LOAN AMT
DOWN
PAYMENT
APR
TIME
PERIOD
$20,000
$20,000
$1,000
$1,000
3.99%
7.75%
3 years
3 years
MONTHLY
PAYMENT
TOTAL
INTEREST
PAID
TOTAL
AMT PAID
TOTAL
INTEREST
PAID
TOTAL
AMT PAID
TOTAL
INTEREST
PAID
TOTAL
AMT PAID
TOTAL
INTEREST
PAID
TOTAL
AMT PAID
5 YEAR NEW CAR LOAN
3
4
5
PRINCIPAL
LOAN AMT
DOWN
PAYMENT
APR
TIME
PERIOD
$25,000
$25,000
$30,000
$1,000
$1,000
$1,000
3%
5%
3%
5 years
5 years
5 years
MONTHLY
PAYMENT
3 YEAR USED CAR LOAN
6
7
8
PRINCIPAL
LOAN AMT
DOWN
PAYMENT
APR
TIME
PERIOD
$10,000
$10,000
$10,000
$1,000
$1,000
$1,000
3%
5%
10%
3 years
3 years
3 years
MONTHLY
PAYMENT
YOUR CHOICE
PRINCIPAL
LOAN AMT
DOWN
PAYMENT
9
10
CONCLUSIONS:
APR
TIME
PERIOD
MONTHLY
PAYMENT
AUTOMOBILE SHOPPING
Use the Internet to find a new AND used vehicle you would like to buy. Copy and paste
a picture and information about the car in the space below. (Screen shot?)
NEW
USED
If you purchased the car with a loan, what would it cost? Complete the chart below.
AMT OF
LOAN
NEW
CAR
USED
CAR
DOWN
PAYMENT
APR
TIME
PERIOD
3%
5 years
5%
3 years
MONTHLY
PAYMENT
INTEREST
PAID
TOTAL
LOAN
AMT
If you saved the money first, how much would it cost you? Complete the chart below.
AMOUNT INTEREST TIME
INITIAL
AMT
TOTAL
NEEDED
RATE
PERIOD
DEPOSIT SAVE /
YOU
MONTH
SPEND
NEW
3%
5 years
CAR
USED
3%
5 years
CAR
Getting a loan to buy the new car will cost YOU $________________
Saving the money to buy the new car will cost YOU $____________
If you can wait to buy the new car when you have saved enough money, you will
actually save $_____________ over buying it.
Getting a loan to buy the used car will cost YOU $________________
Saving the money to buy the used car will cost YOU $____________
If you can wait to buy the used car when you have saved enough money, you will
actually save $_____________ over buying it.
CONCLUSIONS: