If you want to pay off your home mortgage or are looking for a faster way to get out of debt, consider using a loan payoff calculator Excel template. This tool makes it easier for you to calculate how much you will be required to pay every month. By putting in an extra couple hundred dollars on your mortgage or your car payment, you can find out how much quicker you can pay it off.
Advantages of a Loan Payoff Calculator Excel
Using a loan payoff calculator allows you to prioritize your debts. It helps you know exactly when you will have your debts paid off. A payoff calculator automatically calculates interest versus principal reduction each time you make a payment. The more principal you pay on your loan, the less total interest you will have to pay. This will also let you pay your loan off much earlier. A lot of people today use these calculators to help them decide which debts to pay off first.
Using a loan payoff calculator, you’ll know exactly in what order to pay off your debts. Generally, loan payoff calculators use two different methods to help prioritize debt payoff. Some payoff calculators focus on the smallest amount of debt first and then work their way towards the larger amounts. Other payoff calculators focus on making payments on loans with the highest interest rate. Ideally, you want to check a few different variations, and come up with the one that works best for your budget and your long-term goals.
Another advantage of the payoff calculator is they allow you to snowball your debt. This means that once one debt is paid off, that payment goes over to the next loan. Each time you pay off a loan, you have more capital to increase your payments. As a result, you can pay your debts off much faster.
Perhaps the biggest advantage of a payoff calculator is it helps you to set goals for when you can pay off your loans and be out of debt. When people can visualize this happening, they become far more motivated. It is also exciting to use a payoff calculator to watch your debt disappear in just a view short months or years.
Download: Loan Payoff Calculator Excel