Question 1

How is a car payment calculated?

Accepted Answer

Car payment uses the financed amount, annual interest rate, and loan term in months in a standard amortization formula.

Question 2

Does sales tax affect financing?

Accepted Answer

Yes. If tax is added to the vehicle price and financed, your principal and monthly payment both increase.

Question 3

What is an amortization schedule?

Accepted Answer

It is a month-by-month table showing how each payment splits between interest and principal and how the balance declines.

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