Student loan calculator
Student Loan Calculator
The U.S. Department of Education’s Web site features a handy online tool for student loan borrowers to calculate different payment plans. The student loan calculator provides detailed payout information on standard, extended, graduated, income contingent, and consolidation repayment plans.
The student loan calculator can tell borrowers how much and how long a loan will take to payoff. These factors depend on the amount of the loan, interest rate and repayment plan. The calculator is a good resource for students preparing to pay back their student loans. Before selecting a repayment plan, the borrower can review how the different payment options will pan out in the long term. Let’s take for example a $20,000 loan and review the standard repayment plan for that loan.
Under the standard repayment plan, the borrower makes a monthly payment that remains the same over the course of 10 years. The minimum monthly payment is $50 – in the case of the $20,000 loan it calculates out to $230.16. Based on a 6.8 percent interest rate (which is the going rate at this time) and 120 payments, the student pays off the loan and an additional $7,619.31 in interest when it is all said and done. The calculator provides the information below. All the borrower must enter is the interest rate (which defaults to the current rate unless you change it) and the loan amount.
Loan Balance $20,000
Loan Interest Rate 6.8 percent
Loan Terms 10 years
Minimum Payment $50
Monthly Loan Payment $230.16
Number of Payments 120
Cumulative Payments $27,619.31
Total Interest Paid = $7,619.31
Along with calculating loan payoffs, students can also utilized the Web site’s budget calculator. This tool is used to help students create a budget based on their income and expenses. To learn more about the student loan calculator and budget calculator, visit www.ed.gov.