Monique wants to take out a simple interest loan for $2,500 at 6.7% for 3.5 years. How much will she pay in interest?

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Connor Sephton answered
Monique will pay $586.25 in interest if she takes out this loan. Interest can add a great deal to the final tab for an item or service. In fact, it's very important to negotiate the best possible interest rate for any sort of loan.

People who work in the financial services industry seek to increase interest rates so that they can get more profits from every loan they grant; however, for people who ask for loans, interest rates represent huge expenditures over the long term, on top of paying back the original loan amount.

Figuring out interest and how much everything will cost over the course of paying back a loan can be an excellent way to make good financial decisions, yet many people jump the gun and sign on for expensive loans at high interest rates - only to regret it later on.

Tips On Lowering Interest Rates

• A person who is paying too much for interest on a credit card or loan may be able to renegotiate the terms of their contact. For example, if a person calls a credit card company and explains that they are having a hard time making payments at the current rate of interest, and that they are considering changing providers, a credit card company may offer to lower the rate to keep their business. People do these sorts of renegotiations every day - although they don't always work, they are always worth a try. With other loans, a person who is having financial difficulties may be able to plead their case and have an interest rate reduced - however, the loan company is under no legal pressure to do this, and they are able to refuse such a request if they wish.

Getting the hang of calculating interest and monthly payments is easier than ever nowadays, as there are lots of free interest calculators and loan payments calculators available online.

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