How to Figure Loan Maturation Date
A lone maturation date is the date when a loan is scheduled for full repayment, including interest. Calculating the loan maturation date of fixed-interest-rate loans is a relatively simple procedure. In order to calculate the loan maturation date for a variable-rate loan, you will need to recalculate each time the rate changes, either changing the maturation date itself or changing the periodic payments to ensure the agreed-upon maturation date is met depending on the situation.
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Instructions
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1
Call the lender and request a copy of the loan agreement. Read the loan agreement fully when it arrives, since some loan agreements will spell out the maturation date in exact terms, eliminating the need to calculate it yourself.
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Make a note of the total amount owed, the interest rate and when the interest compounds -- either monthly or yearly.
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Make a note of the repayment schedule, which is usually on a monthly basis, and the expected monthly payment.
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4
Divide the total term balance of the loan, including interest, by the minimum monthly payment to arrive at the number of months remaining.
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Round the number of months remaining down to the nearest whole month. Making the final payment a few days early won't do any harm, and makes the calculation much simpler.
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6
Refer to the calendar to determine the estimated loan maturation date.
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Tips & Warnings
Avoid taking loans that compound monthly or weekly in the first place, since the interest rates can quickly eclipse the initial benefit of the loan with ballooning borrowing costs.
Check the loan agreement to see if early repayment will reduce the overall interest paid on borrowing. If it does, then pay back the loan early if at all possible.
Don't round up the number of months left in the loan. This can lead to the last payment's being late, which may incur a penalty.
References
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