Loan calculation formula

• 10-05-2002
C++Nerd
Loan calculation formula
Hello all,

I wrote this program to work out monthly payment for personal loan. Say, you borrow 15000 (principal) at 7.50% APR for 4 years?
So my formula is (maybe wrong):-
1. months = 4 * 12;
2. interest = principal * 7.50 / months;
3. monthlypayment = (principal + Interest) / months;

My monthly payment comes out as 361.38, is this correct?
What is correct formula to do this?

Here is my program, just in case you want to see it. Thanks.

Code:

```// Calculating loan payment/interest #include <iostream> #include <cmath> #include <iomanip> using namespace std; int main() {     char again;                 do         {                 system("CLS");                                 double amount,        //amount per month                         principal,        //loan amount                         rate,                //interest rate                         interest,        //total interest                         months,                //months                         years,                //years term                         totalpayment;                                 // set the floating-point number format                 cout << setiosflags( ios::fixed | ios::showpoint )                         << setprecision( 2 );                 cout << "Enter amount of loan: ";                 cin >> principal;                 cout << "Enter rate ( APR % ): ";                 cin >> rate;                 cout << "Enter number of years: ";                 cin >> years;                 //some calculation                 months = years * 12;                 interest = principal * rate / months;                 amount = (principal + interest) / months;                 totalpayment = principal + interest;                 //display                 cout << endl << "LOAN CALCULATION:";                 cout << endl << "=================" << endl;                 cout << "Total Loan      : " << setw( 8 ) << principal << endl;                 cout << "Rate APR %      : " << setw( 8 ) << rate << endl;                 cout << "Total years    : " << setw( 8 ) << years << endl;                 cout << "Total interest  : " << setw( 8 ) << interest << endl;                 cout << "Monthly payment : " << setw( 8 ) << amount << endl;                 cout << "Total Payment  : " << setw( 8 ) << totalpayment << endl << endl;                 cout << "Again y/n? ";                 cin >> again;         } while (again == 'y' );     return 0; }```
• 10-06-2002
correlcj
Hello!
Quote:

What is correct formula to do this?
This might help you! When I am having problems with some of my formulas i goto ask Dr. Math . Goto google, then type in that name its a fantastic website for people like myself who are not so good with math.
I hope this helps!
Later.
:D