FORMULA for a LOAN
I need to know how to calculate loan payments...
I need to know how much I will pay in total after 15years or whatever payment period lasts and I need to know the monthly bill...
Remember, I think that the APR is calculated on the principal owed so as you pay the principal is reduced and tapers off --
I don't want 100,000 * (1.065^15), that's not how loans work...
the formula for monthly payments is:
the numerator is A, and the denominator is below everything below A.
(1 - (1 + I) ^ -N
This is coming from my calculator, so readability is a bit tedious.
A / ((1 - (1 + I) ^ ( -N)) / I)
A is the loan amount.
I is the interest rate in decimal form divided by 12 (for monthly), i.e. .065 / 12 for 6.5%.
N is the number of months, i.e. 360 months for 30 yrs.
and yes, that is a negative N, just incase it is a bit small to read.
for total amount including interest, just multiply monthly payments by number of months.
edited for correctness of I.
Thank you very much sir!!!