Is this normal?

[Sema's Gti]

Ok so I bought the car on 4/18/2011 for $18,173.65
My last payment was on 1/20/2012
I pay 368.47 a month
My current balance is $16,652.43

I was doing a little math an realized somethings not right. You figure 9 months x 368.47=3,316.23

If I subtract the amount I've paid to the starting balance that's 14,857.42

Can someone tell my why my balance is 16k and not 14k?

I thought maybe it was interest but it seems like interest is charged on each payment?

Principal Amount: $170.00
Interest Amount: $198.47
Fee Amount: $0.00
Transaction Amount: $368.47

Is this normal?

 

[vdub_cordi]

My first instict was interest maybe there is some hidden fees that you dont know about i know some dealers charge a admin fee for some reason when u buy a new car

 

[o6RSGTI]

they make you pay most of the interest first than the rest of the of the loan.

 

[BeveStrown]

You must be getting hosed on your rate (12%?!). Your principal payment is only being applied to the loan balance: [170*10]-18.2 roughly equals 16.5

As you make the 368.47 payments more and more will go towards the loan. If you can, pay more now either in higher monthly or as a lump sum. At the very least pay an even $370 and you should save a couple bucks over the life of the loan

 

[Sema's Gti]

Thanks guys, I was talking to a guy on vortex who basically told me to refinance because at this rate I'd be paying over 8k just in interest for the car.

 

[bhmkv]

Its the %

 

[Sema's Gti]

Yeah 13%

 

[bhmkv]

The amount of % you pay goes down after each payment. Near the end you will be paying more principle. Can make advance payments to cut down the % as well.

 

[mlowmk5]

Yeah, its pretty tricky, you are basically paying mostly interest in the beginning then more principal towards the end. the ratio slowly shifts as you pay more off.

Wait till you pull a home loan. This is why APR is so important when you pull loans. It can mean a difference of hundreds or even thousands of dollars down the road.

 

[Flapenn]

ZOMG monthly payment is crazyy.

mine is wayy cheaper

payment-217.39
principal-174.83
interest-42.56

what changes the rate of interest you pay? is it your credit and how much you put down?

 

[xcrazydx]

Your credit rating

 

[vdub_cordi]

whats ur rate usually when u buy new vw offers 0.9-5% depending the term rate

 

[enjoyincubus365]

For 13% I would rather rock a beater with a heater than take that loan.

 

[Bodhi]

Yeah, that's madness man.

Refinance or sell the car, really.


My rate is considered "high" at 3.9% (no co-signer, first time buyer.)

 

[enjoyincubus365]

3.4 here. 24 years old no co signer.