Compare Two Loans Calculator
Financial Lending Analysis Tool

Description:
Financial calculator for comparing or analyzing two loans
or mortgages. The calculator is for fixed rate loans based.
Typically fixed rate loans are used to purchase or buy cars,
trucks, automobiles, recreational vehicles and homes using
fixed rate mortgages. This calculator should not be used
for Adjustable Rate Mortgage (ARM), revolving lines of credit
or credit card calculations, since payment are not fixed
or equal month to month.

Analysis includes monthly and total payment, interest and
principal paid, balance versus time and amortization table
calculations. The tool give visual representation of the
data using charts, graphs, plots and tables.

Instructions:

Step

Instructions

Notes

1

Enter loan amounts.

The loan amount is the total
amount of money being loaned from the bank, mortgage
company, lender or other financial institution.

2

Enter interest rate.

Interest rate is the lending rate
the bank is charging for the loan. Enter the value
as a percent. Typically, loans with longer terms
have a higher rate and shorter term loans have a
lower rate. Moreover, a person with good credit
will qualify for a lower interest rate as opposed
to a person with bad credit. Tip, a person should
shop around for the best deal. In many cases, mortgage
rates can be negotiated.

3

Enter the term

Term is the number of years it
will take to repay or payoff the loan. It is the
duration or length of time payments will be sent
to the lender. Note, this calculator assumes payments
are made on a monthly basis.

4

Press Calculate button

The calculate button will update
the solution, charts, graphs, plots and tables.

Explanation for Solution, Charts
Graphs and Tables:

Location

Parameter

Explanation

Solution

Term

The program calculates the number
of months payments will be sent to the lender. It
is the number payments. Note, one year has twelve
months.

Solution

Monthly payment

The amount of money to be paid
to the lender each month.

Solution

Total payments

The total amount of money paid
during the lifetime of the loan. It is calculated
by multiplying the term or number payments by the
monthly payment. Total payments in total amount
of interest and principal paid.

Solution

Total interest paid

The total amount of money paid
to the lender for loaning the money over the lifetime
of the loan.

Solution

Loan amount

User input of the amount of money
being borrowed.

Solution

Total interest paid

User input of the interest rate.

Bar charts

Monthly payment

Provides a visual representation
of the monthly payment for loan 1 and loan 2.

Bar charts

Total paid

Provides a visual representation
of the total paid amounts for the loans.

Bar charts

Total interest paid

Provides a visual representation
of the total interest paid for each of the loans.

Graphs

Loan Balance vs. Time

A graph showing the loan balances
over time. The lines show how much cash is still
owed as payments are made over time.

Graphs

Interest and Principal versus
Time

A graph showing the amount of
money being applied to interest and principal for
each payment. Principal reduces the loan amount.
Interest goes the the lender. Note, the amount on
interest per payment get lower over time.

Tables

Amortization tables

A numeric table showing how each
monthly payment is divided into interest and principal.
In addition, it shows the monthly payment (same
for each month) and loan balance for each month.