Maestro

Calculating Principal Payments (2)

The PPMT function uses the following syntax; you’ll note that most of the arguments are the same as for the PMT function: PMT(rate, per, nper, prin, [fv, type]) The first four arguments are required. They are rate is the interest rate for the loan....

Maestro

Calculating Principal Payments

When you make a payment on a loan, each payment is divided into two parts: Part of the payment is for that month’s interest charge. The remainder of the payment goes toward paying down the principal. Each month you pay down the loan balance, or principal, by some amount. This means that the next month the interest charge will be less because the charge is calculated as the interest rate...

Maestro

Calculating Loan Payments (3)

In most situations you omit both of these optional arguments. Let’s create a simple loan calculator using the PMT function. Start with a blank worksheet and then follow these steps: Put the labels Amount of loan, Annual rate, Term in years, and Monthly payment in cells B2 through B5, in order....

Maestro

Calculating Loan Payments (2)

The PMT function uses the following syntax: PMT(rate, nper, prin, [fv, type]) The first three arguments are required. They are rate is the interest rate for the loan....

Maestro

Calculating Loan Payments

Few people can make it though life without taking out one or more loans. By extending payments over a period of time, a loan enables you to buy something now that otherwise you would have to save for over a long time. Big ticket items, such as a car or house, are perhaps the most common uses of loans....