Loan payment calulator formula
Creating a loan amortization schedule is a simple way to calculate a loan's payoff date. It is a breakdown of the loan payments, balances, and how much principal and interest are being paid until the loan is paid off. This spreadsheet can be done in Microsoft Excel or with a loan payoff calculator found on the Internet. Whether the loan is for a car, home mortgage, school loans or any personal reason, knowing the loan's payoff date helps you budget your money.
Instructions
1. Download a loan amortization spreadsheet from "It's Your Money!" at Mdmproofing.com. (See Resource.) This is one of many spreadsheets available on the Internet and is being used as an example. The spreadsheet works with Microsoft Excel and Open Office. According to Calculators4Mortgages.com, "While some financial experts caution against paying off a mortgage early, if you have extra cash on hand and don't like debt, reducing or eliminating your mortgage more quickly than the agreed upon schedule may give you the peace of mind or breathing room in your budget." This spreadsheet will help you to calculate a loan's payoff date if you choose to make extra payments or not.
2. Read the first tab labeled "Intro" on the bottom of the spreadsheet for instructions and information on use the spreadsheet.
3. Use the second tab, "Quick Payment Calculator," to find out a monthly payment. This information is useful to see if the monthly payment is within your budget, if you are considering taking out a loan.
4. Fill in your specific loan information on the third tab, "Loan Amortization." Amortized payments are calculated by dividing the principal balance by the number of months allotted for repayment. Then interest is calculated at the fixed rate your loan is locked in to. Each payment reduces a percentage of the interest first, with the balance of the payment reducing the principal. This loan amortization template calculates the monthly amortized payments and indicates the loan payoff date.
5. By paying an additional amount to the principal balance each month, you can save money and reduce the life of the loan. This interactive spreadsheet also provides a section for "regular additional contribution" and "one-time additional." Enter this information, and the spreadsheet will calculate the loan's payoff date.
6. Search "calculate loan payoff date" to find an amortization schedule online that will work for your needs. There are numerous spreadsheets available to download from the Internet. Some are specific to the type of loan such as car loan, mortgage or student loans.
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