Amount Financed
Definition:
The amount financed is the total amount of money that you borrow from a lender when you take out a loan. It includes the principal amount of the loan, as well as any fees or closing costs that are associated with the loan.
Example:
Here are some of the factors that can affect the amount financed:
The principal amount of the loan: The principal amount of the loan is the amount of money that you borrow from the lender. This will be the largest component of the amount financed.
The interest rate on the loan: The interest rate on the loan is the cost of borrowing money. The higher the interest rate, the higher the amount financed will be.
The closing costs: Closing costs are the fees associated with taking out a loan. These fees can include things like appraisal fees, origination fees, and title insurance.