When considering debt consolidation, an amortization calculator emerges as a vital tool for borrowers. This calculator helps individuals manage their debts by providing clear insights into payment structures, interest accrual, and repayment timelines. By understanding how amortization works, one can make informed decisions and optimize loan strategies to reduce financial strain. This article delves deep into the intricacies of using an amortization calculator for debt consolidation, covering its features, benefits, and essential considerations for borrowers seeking financial relief.

What is an Amortization Calculator for Debt Consolidation?

An amortization calculator for debt consolidation is a tool used to determine the repayment schedule of a consolidated loan. It breaks down payments into principal and interest, helping borrowers understand their financial obligations.

Definition of Amortization

Amortization refers to the process of gradually repaying a loan through scheduled payments over a specified period. Each payment reduces the loan’s principal while covering interest costs. This systematic approach ensures that borrowers know how much to pay and when, making it easier to manage finances.

How Amortization Calculators Work

Amortization calculators require input data such as loan amount, interest rate, and loan term. They use this information to generate an amortization schedule, detailing monthly payments and showing how much of each payment goes toward interest versus principal. This visualization helps borrowers understand their debt management better.

Types of Debt Consolidation

Debt consolidation can take various forms, including personal loans, balance transfer credit cards, and home equity loans. Each type has its unique features and benefits. For example, personal loans often come with lower interest rates, while balance transfer cards can offer introductory 0% APRs for a limited time.

How Does Debt Consolidation Work?

Debt consolidation works by combining multiple debts into a single loan with a lower interest rate, simplifying repayments. This strategy can streamline finances and reduce monthly payment amounts, making it easier for borrowers to manage their debt.

Understanding Debt Consolidation

Debt consolidation involves taking out a new loan to pay off existing debts. This approach allows borrowers to manage their payments more efficiently by consolidating them into one monthly payment. The goal is to lower overall interest rates and simplify repayment schedules.

Benefits of Debt Consolidation

Among the key benefits of debt consolidation are reduced monthly payments, lower overall interest rates, and a simplified repayment process. Borrowers can escape the cycle of high-interest debts, which can significantly improve their financial health and provide relief from stress.

Risks Involved in Debt Consolidation

While debt consolidation offers benefits, it also carries risks. Borrowers may face fees associated with new loans, and if they do not change their spending habits, they could accumulate more debt. Additionally, failure to make timely payments can adversely impact credit scores.

Why Use an Amortization Calculator?

An amortization calculator is essential for understanding payment schedules and the long-term financial impacts of loans. It equips borrowers with insights to make informed decisions about debt consolidation and repayment strategies.

Understanding Your Payments

An amortization calculator breaks down how much you will pay each month and how much of that payment goes towards interest and principal. This clarity helps borrowers adjust their budgets accordingly and prioritize debt repayment, enhancing financial planning.

Projecting Future Payments

Using an amortization calculator allows borrowers to project future payments based on different scenarios, such as varying interest rates or loan terms. This capability enables individuals to plan for changes in their financial situations and stay proactive about their debt management.

Comparing Loan Options

With an amortization calculator, borrowers can compare different loan options side by side. By inputting varying interest rates and loan amounts, individuals can see how these factors affect overall costs, helping them choose the most financially advantageous option.

What Are the Key Features of an Amortization Calculator?

Key features of an amortization calculator include input requirements, output details, and additional tools for enhanced user experience. These features help borrowers gain comprehensive insights into their loans.

Input Requirements

To effectively use an amortization calculator, users need to input several key pieces of information: the total loan amount, interest rate, loan term, and payment frequency. These inputs are crucial for generating accurate amortization schedules and payment breakdowns.

Output Details

The output from an amortization calculator typically includes the total payment amount, breakdown of principal and interest, and an amortization schedule. This detailed information helps borrowers visualize their progress and understand the implications of their borrowing decisions.

Additional Tools

Many amortization calculators offer additional tools, such as payment comparison charts and graphs that illustrate the impact of extra payments. These features enhance the calculator’s utility, allowing users to optimize their repayment strategies further.

How to Use an Amortization Calculator for Debt Consolidation?

Using an amortization calculator for debt consolidation involves a straightforward process where borrowers input their loan details and analyze the results to make informed decisions about repayment.

Step-by-Step Guide

To use an amortization calculator effectively, follow these steps: First, gather all necessary loan information, including total debt, interest rates, and desired payment terms. Then, input this data into the calculator. Finally, analyze the results, focusing on monthly payments and the amortization schedule.

Common Mistakes to Avoid

Common mistakes when using an amortization calculator include entering incorrect loan amounts or interest rates, overlooking fees that can affect total costs, and not adjusting for different payment frequencies. Being diligent about these details ensures accurate results.

Interpreting the Results

Once the amortization calculator generates results, it’s important to understand the implications. Look closely at the monthly payment amounts, total interest paid over the loan term, and how extra payments can impact the overall repayment timeline. This analysis helps in making informed decisions.

What Factors Should You Consider When Choosing a Debt Consolidation Loan?

When selecting a debt consolidation loan, critical factors include interest rates, loan terms, and associated fees. These aspects directly affect the overall cost and effectiveness of the consolidation strategy.

Interest Rates

The interest rate is perhaps the most important factor to consider when choosing a debt consolidation loan. Lower interest rates can lead to significant savings over time. Borrowers should shop around and compare rates from different lenders to ensure they secure the most favorable terms possible.

Loan Terms

Loan terms refer to the length of time over which the loan must be repaid. Shorter terms may result in higher monthly payments but less overall interest paid, while longer terms may lower monthly payments but increase total interest costs. Balancing these factors according to financial capabilities is crucial.

Fees and Charges

Many debt consolidation loans come with fees such as origination fees, closing costs, or prepayment penalties. Understanding these charges is essential, as they can significantly impact the overall cost of the loan and the potential savings from consolidation.

How Can an Amortization Calculator Help You Save Money?

An amortization calculator can facilitate savings by helping borrowers identify lower monthly payments, reduce overall interest paid, and accelerate debt repayment timelines, ultimately leading to significant financial relief.

Lowering Monthly Payments

By using an amortization calculator, borrowers can explore different loan amounts and terms to find options that lower their monthly payments. This flexibility can ease financial pressure and allow for better cash flow management, especially during challenging financial times.

Reducing Interest Paid

Calculating various scenarios with an amortization calculator can reveal opportunities to reduce overall interest payments. For instance, consolidating high-interest credit card debt into a loan with a lower rate can save borrowers substantial amounts in interest over the loan’s lifespan.

Paying Off Debt Faster

Utilizing an amortization calculator to explore extra payment options can significantly shorten the loan repayment period. By applying additional funds toward the principal, borrowers can reduce the loan balance more quickly, thus minimizing interest costs and achieving debt freedom sooner.

What Types of Debt Can Be Consolidated?

Common types of debt that can be consolidated include credit card debt, student loans, and personal loans. Understanding the nuances of each type can help borrowers make informed decisions about their consolidation options.

Credit Card Debt

Credit card debt is often the primary target for consolidation due to its typically high-interest rates. Borrowers can consolidate this debt into a personal loan or balance transfer card with a lower rate, potentially saving money and simplifying payments.

Student Loans

Student loans can also be consolidated through federal or private refinancing options. This process may help borrowers secure a lower interest rate or more favorable loan terms, making monthly payments more manageable and potentially reducing overall debt costs.

Personal Loans

Personal loans are a flexible option for debt consolidation, allowing borrowers to combine various debts into one. These loans often come with fixed interest rates and predictable payment schedules, providing a clear path to repayment.

How Is Your Amortization Schedule Affected by Interest Rates?

Your amortization schedule is significantly impacted by the interest rate associated with your loan. Higher interest rates lead to larger portions of each payment going toward interest, extending the repayment period and increasing total costs.

Fixed vs. Variable Rates

Understanding the difference between fixed and variable interest rates is crucial for borrowers. Fixed rates remain constant throughout the loan term, providing stability, while variable rates can fluctuate, potentially increasing payment amounts over time and complicating budget planning.

Impact of Rate Changes

For loans with variable rates, fluctuations can drastically alter your amortization schedule. If rates rise, monthly payments could increase, leading to higher overall interest payments. This unpredictability makes it essential for borrowers to assess their risk tolerance before selecting a loan.

Long-Term vs. Short-Term Loans

Long-term loans generally have lower monthly payments but accrue more interest over time, while short-term loans have higher monthly payments but lower total interest costs. Borrowers need to weigh their financial situation and goals when deciding on loan durations.

What Is the Difference Between Amortization and Interest-Only Payments?

The primary difference between amortization and interest-only payments lies in how each affects the loan balance. Amortization reduces the principal over time, while interest-only payments defer principal repayment, which can lead to larger outstanding balances later.

Understanding Amortization

Amortization involves making regular payments that cover both principal and interest, gradually reducing the loan balance. This method ensures that borrowers build equity over time and avoid the pitfalls of accumulating interest without reducing the principal.

Benefits of Amortization

One significant benefit of amortization is the predictability it offers borrowers. Knowing that each payment contributes to reducing the principal helps with financial planning and ensures that debts are cleared in a structured manner.

When to Choose Interest-Only Payments

Interest-only payments may be appropriate for borrowers expecting a significant increase in income or those looking to manage cash flow temporarily. However, this option can be risky, as it defers principal repayment and can lead to larger payments in the future.

Can You Use an Amortization Calculator for Refinancing?

Yes, an amortization calculator is beneficial for refinancing as it helps borrowers evaluate new loan terms, calculate potential savings, and compare the financial impact of refinancing against existing loans.

Understanding Refinancing

Refinancing involves replacing an existing loan with a new one, often with improved terms or lower interest rates. This process can lead to significant savings over time, making it an appealing option for those looking to reduce their financial burden.

Benefits of Using an Amortization Calculator

Using an amortization calculator during refinancing allows borrowers to visualize potential savings, compare old and new payment schedules, and assess the overall cost implications of refinancing. This informed approach aids in making sound financial decisions.

Comparison with Debt Consolidation

While both refinancing and debt consolidation aim to lower costs and simplify payments, they differ in execution. Refinancing typically involves a single loan, whereas debt consolidation may involve multiple debts rolled into one. Understanding these distinctions can help borrowers determine the best strategy for their circumstances.

What Are Prepayment Penalties?

Prepayment penalties are fees charged by lenders if a borrower pays off their loan early. Understanding these penalties is crucial for borrowers considering debt consolidation, as they can affect overall loan costs and repayment strategies.

Definition of Prepayment Penalties

Prepayment penalties are fees imposed by lenders when borrowers pay off their loans before the agreed-upon term. These penalties can vary significantly among lenders and loan types, making it essential for borrowers to review loan terms carefully.

How They Affect Your Amortization

Prepayment penalties can impact the overall cost-effectiveness of a loan. If a borrower pays off their loan early, they may incur additional fees, potentially negating savings from lower interest costs. Borrowers should factor these penalties into their financial calculations when considering a loan.

Strategies to Avoid Prepayment Penalties

To avoid prepayment penalties, borrowers should seek loans with no penalties or negotiate terms with lenders. Additionally, understanding the loan agreement and being aware of potential fees can help borrowers make informed decisions and avoid unexpected costs.

How to Interpret Your Amortization Schedule?

Interpreting an amortization schedule involves understanding the breakdown of payments, distinguishing between principal and interest, and recognizing the impact of making extra payments on the overall loan duration.

Understanding the Breakdown of Payments

An amortization schedule clearly outlines how much of each payment goes toward the principal versus interest. This breakdown is crucial for borrowers to understand their progress in paying down the loan and managing their financial commitments effectively.

Identifying Principal vs. Interest

Each entry in an amortization schedule indicates the portion of the payment that reduces the principal and the portion that covers interest. Recognizing this distinction helps borrowers strategize on how to allocate extra funds towards principal repayment to minimize interest costs.

Impact of Extra Payments

Making extra payments toward the principal can significantly shorten the loan term and reduce the total interest paid. An amortization schedule can illustrate how additional payments affect the repayment timeline, providing clear incentives for borrowers to pay down debt faster.

What Are the Common Myths About Debt Consolidation?

Common myths about debt consolidation include misconceptions that it eliminates debt, guarantees lower interest rates, or is only for those with poor credit. Understanding the reality behind these myths is essential for making informed financial decisions.

Myth vs. Reality

One prevalent myth is that debt consolidation eliminates debt. In reality, it simply combines debts into one loan, requiring diligent repayment to truly reduce overall debt. Borrowers need to maintain financial discipline to avoid falling back into debt.

Understanding the Truth

Another misconception is that debt consolidation always results in lower interest rates. While it can lead to lower rates in many cases, borrowers should carefully compare options to ensure they achieve the best terms for their situation.

Debunking Misconceptions

Many believe that debt consolidation is only available to those with poor credit. In truth, borrowers with good credit can also benefit from consolidation by securing lower rates and improved terms. Understanding this can empower more individuals to seek financial relief.

How Does Credit Score Affect Debt Consolidation?

Your credit score plays a crucial role in debt consolidation, influencing loan approval chances and interest rates. A higher credit score can secure better terms and lower costs for borrowers.

Impact of Credit Score on Loan Approval

A strong credit score typically enhances a borrower’s chances of loan approval for debt consolidation. Lenders view high scores as a sign of responsible borrowing behavior, leading to competitive interest rates and favorable loan terms.

Credit Score Improvement Strategies

To improve credit scores before applying for debt consolidation, borrowers should pay down existing debts, make timely payments, and limit new credit inquiries. These actions can lead to a stronger credit profile, increasing the likelihood of securing favorable loan terms.

Long-Term Effects on Credit Score

Successfully consolidating debt can positively impact credit scores in the long run. By reducing outstanding debt and maintaining timely payments, borrowers can improve their credit utilization ratio and overall creditworthiness, paving the way for future financial opportunities.

What Are the Alternatives to Debt Consolidation?

Alternatives to debt consolidation include debt management plans, bankruptcy, and negotiating with creditors. Each option has its implications and suitability depending on individual financial situations.

Debt Management Plans

Debt management plans involve working with a credit counseling agency to negotiate more favorable terms with creditors. This approach may lower interest rates and monthly payments, providing a structured way to pay off debt without taking on new loans.

Bankruptcy

Bankruptcy is a legal option for individuals overwhelmed by debt. While it can provide relief, it comes with significant long-term consequences for credit scores and future borrowing capabilities. It’s crucial for borrowers to consider this option carefully and consult legal advice.

Negotiating with Creditors

Borrowers can directly negotiate with creditors to seek reduced interest rates or payment plans. This approach can lead to customized solutions that fit individual financial situations, providing relief without the need for consolidation loans.

How Can You Improve Your Chances of Approval for a Debt Consolidation Loan?

Improving your chances of loan approval for debt consolidation involves enhancing your credit score, reducing your debt-to-income ratio, and preparing necessary financial documents.

Improving Your Credit Score

To enhance credit scores prior to applying for a debt consolidation loan, individuals should focus on timely bill payments, reducing outstanding debts, and correcting any inaccuracies on credit reports. A higher credit score can make a significant difference in loan approval and terms.

Reducing Debt-to-Income Ratio

A lower debt-to-income (DTI) ratio enhances a borrower’s profile, making them more appealing to lenders. Reducing existing debts or increasing income can help achieve a more favorable DTI, increasing the likelihood of loan approval.

Preparing Your Financial Documents

Having organized financial documents ready for submission can streamline the application process. Lenders typically require income verification, debt statements, and personal identification. Being prepared can expedite approval and enhance borrower credibility.

What Are the Tax Implications of Debt Consolidation?

The tax implications of debt consolidation vary depending on the type of loans involved and the borrower’s financial situation. Understanding these implications is essential for informed decision-making.

Tax-Deductible Interest

In some cases, the interest on debt consolidation loans may be tax-deductible, particularly for loans used for qualified educational expenses or business purposes. Borrowers should consult with tax professionals to determine eligibility and optimize their tax situations.

Potential Tax Liabilities

Borrowers should also be aware of potential tax liabilities that can arise from debt forgiveness associated with some consolidation options. If debt is forgiven, it may be considered taxable income, leading to unexpected tax bills. Careful planning is essential.

Consulting a Tax Professional

Engaging a tax professional can provide personalized advice on the tax implications of debt consolidation. They can help borrowers navigate complex regulations and develop strategies to minimize tax liabilities, enhancing overall financial planning.

How Often Should You Use an Amortization Calculator?

Borrowers should utilize an amortization calculator regularly, particularly during financial check-ups, when considering new loans, or after significant changes in financial circumstances. This practice ensures that individuals stay informed and proactive about their debt management.

Regular Financial Check-Ups

Conducting regular financial check-ups using an amortization calculator can help borrowers understand their current debt situation. By assessing payment schedules and exploring refinancing options, individuals can stay on top of their financial health and make necessary adjustments.

When Considering New Loans

Using an amortization calculator before taking out new loans allows borrowers to evaluate potential repayment scenarios. This foresight can help individuals understand how new debt will fit into their financial plans and whether it aligns with their long-term goals.

After Major Financial Changes

Significant changes in income or expenses may warrant a reevaluation of existing loans. An amortization calculator can help assess how these changes impact repayment schedules, encouraging timely adjustments to avoid financial pitfalls.

What Are the Best Amortization Calculators Available?

The best amortization calculators offer user-friendly interfaces, accurate calculations, and valuable features like payment comparisons and graphical representations. These tools can greatly assist borrowers in managing their debt effectively.

Online Tools

Many reputable financial websites provide free online amortization calculators. These tools often include advanced features, allowing users to save scenarios and customize inputs to suit their specific needs, making them ideal for thorough financial analysis.

Mobile Apps

Mobile apps dedicated to financial management often include amortization calculators as part of their offerings. These apps provide convenient on-the-go access to calculate payments and track progress, making it easier for borrowers to stay engaged with their financial health.

Features to Look For

When selecting an amortization calculator, look for features such as the ability to adjust interest rates, payment frequencies, and loan amounts. Additional functionalities like visual graphs and comparison tools can enhance the user experience and improve decision-making.

How Can You Customize Your Amortization Calculator Results?

Customizing amortization calculator results involves adjusting loan amounts, interest rates, and modifying loan terms to reflect personal financial situations. This flexibility allows borrowers to model different scenarios and identify the best repayment strategies.

Adjusting Loan Amounts

Borrowers can input various loan amounts into the calculator to see how changes affect monthly payments and total interest paid. This feature is particularly useful for those considering different consolidation amounts based on their financial needs.

Changing Interest Rates

Adjusting interest rates within the calculator can help borrowers understand how these changes impact payment schedules. Testing different rates can provide insights into potential savings and assist in comparing loan options effectively.

Modifying Loan Terms

Modifying loan terms allows borrowers to explore various repayment timelines. By adjusting the duration of the loan, individuals can assess how it affects monthly payments and overall interest, aiding in the selection of the most suitable consolidation option.

What Should You Do If Your Debt Consolidation Loan Is Denied?

If your debt consolidation loan is denied, understanding the reasons behind the denial and exploring alternative solutions is crucial for moving forward and improving your financial situation.

Understanding the Denial Reasons

Common reasons for loan denial include insufficient credit scores, high debt-to-income ratios, or inadequate income. Identifying these factors can help borrowers address them directly and increase their chances of approval in the future.

Next Steps to Take

After a denial, borrowers should consider taking steps to improve their financial profile, such as reducing debts, enhancing credit scores, or increasing income. Additionally, reviewing the application process for errors can ensure that future submissions are more robust.

Alternative Solutions

If a debt consolidation loan is not viable, borrowers may explore alternatives such as debt management plans, negotiating directly with creditors, or seeking professional financial advice. These options can provide pathways to managing debt without consolidation loans.

How Do Lenders Calculate Debt-to-Income Ratio?

Lenders calculate the debt-to-income (DTI) ratio by dividing total monthly debt payments by gross monthly income. This ratio helps assess a borrower’s ability to manage additional debt responsibly.

Definition and Importance

The DTI ratio is a critical measure used by lenders to evaluate a borrower’s financial stability. A lower DTI indicates a greater capacity to manage new loans, making it a vital factor in loan approval processes.

Calculating Your DTI

To calculate your DTI, sum all monthly debt payments, including mortgages, credit cards, and other loans. Then, divide this total by your gross monthly income. A DTI ratio below 36% is generally considered favorable by lenders.

Improving Your DTI

Improving your DTI can be achieved by increasing income, reducing monthly debt payments, or both. Strategies include paying down existing debts, avoiding new debt accumulation, or seeking higher-paying job opportunities to enhance financial stability.

How Can You Monitor Your Progress After Debt Consolidation?

Monitoring progress after debt consolidation involves setting clear financial goals, tracking payments, and utilizing financial apps to stay informed about your debt status and overall financial health.

Setting Financial Goals

Establishing specific, measurable financial goals is crucial for maintaining focus after debt consolidation. These goals could include targets for monthly savings, debt repayment timelines, or improvements in credit scores, providing motivation and direction.

Tracking Payments

Consistently tracking payments ensures that borrowers stay on schedule with their debt obligations. Utilizing calendars, financial apps, or spreadsheets can help individuals monitor their repayment progress and make timely adjustments if necessary.

Using Financial Apps

Financial apps can provide valuable insights and reminders for managing consolidated debts. Many apps offer features for tracking expenses, monitoring payment schedules, and providing budgetary support, empowering borrowers to maintain control over their finances.

What Should You Avoid During the Debt Consolidation Process?

During the debt consolidation process, borrowers should avoid taking on more debt, ignoring budget constraints, and skipping payments. These missteps can undermine the benefits of consolidation and lead to further financial distress.

Taking on More Debt

Accumulating new debt while attempting to consolidate existing obligations can derail financial progress. Borrowers should focus on managing their current debts before considering additional loans or credit, ensuring that they do not fall back into debt traps.

Ignoring Your Budget

Failing to adhere to a budget can lead to overspending and financial instability. It’s vital for borrowers to develop and stick to a budget that aligns with their repayment plan, enabling them to manage expenses and prioritize debt repayment effectively.

Skipping Payments

Missing payments can have severe consequences on credit scores and financial health. Borrowers should prioritize timely payments and set up reminders or automatic payments to ensure they remain on track with their debt consolidation efforts.

How Can an Amortization Calculator Aid in Planning for Future Financial Goals?

An amortization calculator can assist in planning for future financial goals by helping borrowers visualize how debt repayment fits into their broader financial strategy, including budgeting for significant purchases and saving for retirement.

Setting Budgeting Goals

Using an amortization calculator to analyze loan payments can help individuals establish realistic budgeting goals. By understanding how monthly payments will change, borrowers can adjust their budgets to accommodate these costs while still saving for other objectives.

Preparing for Major Purchases

When planning for major purchases, such as a home or vehicle, an amortization calculator can help borrowers assess how existing debt will affect their ability to secure financing. This foresight can aid in making informed buying decisions without compromising financial stability.

Saving for Retirement

Debt repayment and retirement savings should be balanced for long-term financial health. An amortization calculator can help borrowers determine how much they can afford to allocate to retirement savings while still meeting debt obligations, promoting overall financial wellness.

What Are the Benefits of Seeking Professional Advice for Debt Consolidation?

Seeking professional advice for debt consolidation can provide personalized financial strategies, help navigate complex loan terms, and avoid costly mistakes, ultimately leading to more effective debt management.

Understanding Complex Terms

Debt consolidation can involve various loan products with intricate terms and conditions. Professionals can clarify these terms, ensuring borrowers fully understand their options and the implications of their choices, which can lead to more informed decisions.

Personalized Financial Strategies

Financial advisors can develop tailored debt consolidation strategies that align with individual circumstances and goals. This personalized approach ensures that borrowers consider all facets of their financial situations, leading to optimal outcomes.

Avoiding Costly Mistakes

Professional guidance can help borrowers avoid common pitfalls associated with debt consolidation, such as choosing loans with unfavorable terms or neglecting to consider total costs. This proactive approach can save money and enhance overall financial health.

Mini FAQ

What is an amortization calculator?

An amortization calculator helps borrowers understand their loan repayment schedules by breaking down monthly payments into principal and interest components.

How does debt consolidation work?

Debt consolidation combines multiple debts into a single loan with a potentially lower interest rate, simplifying repayment and possibly reducing monthly payments.

What factors affect my loan approval for debt consolidation?

Key factors include your credit score, debt-to-income ratio, and overall financial health, which lenders assess to determine approval and loan terms.

Can I use an amortization calculator for refinancing?

Yes, an amortization calculator is beneficial for refinancing as it helps evaluate new loan terms and potential savings compared to existing loans.

What types of debts can be consolidated?

Common debts that can be consolidated include credit card debt, student loans, and personal loans, each offering unique consolidation options.

What are the common myths about debt consolidation?

Common myths include the belief that debt consolidation eliminates debt or guarantees lower interest rates, whereas it simply combines debts requiring disciplined repayment.

How can I monitor my progress after debt consolidation?

Monitor progress by setting financial goals, tracking payments, and using financial apps to ensure you stay on track with your repayment plan.