What will your monthly payments be?

I have looked around a bit to see what loan calculators are out there that help calculate what your cost will be to borrow money.  This particular one, from the Royal Bank of Canada seems to be quite flexible.  Of course the bank wants to make it easy for you to calculate the payments however I have my doubts that you will be able to find a good interest rate at the bank – that has been my experience.  Most of the car manufacturers have set up a financing arm of their business to provide loans for the purchase of their cars at a much lower rate than the banks.  As an example, banks right now tend to lend in the 8 to 9% range for cars while there are many manufacturers that are selling cars with 0% loans.  On a $40,000 car (and amazingly that is not that expensive $35,398 before tax) the difference is $165 per month over a 6 year term – big difference.  The Royal Bank calculator is here at RBC.

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