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m4a1mustang · 02-20-2012, 10:04 AM

How can finance charges be less over a longer term if the interest rates are the same? That's the stupidest thing I've ever heard.

You pay LESS in interest over a shorter term than you do over a longer term.

Just a quick NPV assumption of $20,000 borrowed at 3% shows you pay $938 in interest over 36 months and $1,562 over 60 months.

Seriously. Wtf?

02-20-2012, 10:04 AM	#66 (permalink)
m4a1mustang A True Z Fanatic Join Date: Feb 2009 Location: Northern VA Posts: 55,385 Drives: on two wheels Rep Power: 6962	How can finance charges be less over a longer term if the interest rates are the same? That's the stupidest thing I've ever heard. You pay LESS in interest over a shorter term than you do over a longer term. Just a quick NPV assumption of $20,000 borrowed at 3% shows you pay $938 in interest over 36 months and $1,562 over 60 months. Seriously. Wtf? __________________ - Steve Zs & Coffee - Saturdays at 10AM in Fairfax, VA and Columbia, MD (Click the banner!) LIKE us on Facebook!