How to Calculate Monthly Payments On Your Student Loan

Student loans are paid off in monthly installments which begin a few months after graduation. The process for determining your monthly payments is an advanced mathematical calculation that can be determined with the help of an ammortization calculator or by speaking with your lender. Here are some steps to determining an estimated monthly payment for your student loans.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• interest rates for each loan
• calculator
• loan documentation

1. Gather all loan documentation. If you need extra copies, contact your lender.
2. Review the documents so you know what types of loans you have. Read over the documents to see the interest rates and payment terms.
3. Figure out your total amount of loans and multiply the principal amounts by the interest rates.
4. Add those numbers and divide by 12 for a general monthly payment. This amount will change as you progress through the years.
5. Contact and meet with your borrower. They can help you calculate your monthly payment schedule for each payment so you can plan in advance.
6. Visit online amortization calculators to determine your exact monthly payments.

Tips & Warnings

• If you consolidate your loans, separate your federal and private loans. The federal loans have better terms and you do not want them lumped in with your private loans.
• There are several amortization calculators online that can calculate your monthly payments in an instant.
• Parent PLUS Loans typically have a rate of 7.94 percent. Stafford Loans typically have a rate of 7.14 percent.
• Make sure to pay your loan on time or you will be in default.

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