1. What is the Car Loan Payment Formula?

The car loan payment formula calculates the fixed monthly payment required to repay a car loan over a specified term. This is the standard formula used by Westpac and most banks for fixed-rate car loans.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( P \) — Principal loan amount (AUD)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Total number of monthly payments
• \( PMT \) — Monthly payment amount (AUD)

Explanation: The formula accounts for compound interest over the life of the loan, ensuring each payment covers both principal and interest.

3. Importance of Loan Calculation

Details: Understanding your monthly payment helps with budgeting and ensures the loan is affordable. It also helps compare different loan offers.

4. Using the Calculator

Tips: Enter the loan amount in AUD, annual interest rate (Westpac's current car loan rate), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is Westpac's current car loan rate?
A: Rates vary based on credit score and loan terms. Check Westpac's website or contact them for current rates.

Q2: Does this include fees and charges?
A: No, this calculates principal and interest only. Westpac may charge additional fees.

Q3: Can I make extra repayments?
A: Westpac typically allows extra repayments on variable rate loans but may charge fees for fixed rate loans.

Q4: How does loan term affect payments?
A: Longer terms reduce monthly payments but increase total interest paid. Shorter terms have higher payments but lower total cost.

Q5: Is this calculator accurate for Westpac loans?
A: This provides an estimate. Actual payments may vary based on Westpac's specific terms and your credit profile.