|
Re: loan payments - Interest only?
Steach91 wrote:
> I know the pmt function allows for a regularly mortgage payment to be
> calculated, but is there a function, or does anyone know a working
> formula to calculate an interest only payment?
(You might need to specify whether you are talking about Canadian
mortgage or otherwise. I will assume a US mortgage.)
It is simply the interest accrued during the month (or payment period).
Ostensibly, for a $150,000 loan at 7% interest rate for example, that
is simply 150000*7%/12 = $875. And that is indeed what one online
interest-only calculator computes.
However, for most US loans, I believe interest compounds daily. In
order to keep the interest-only payments equal (I presume), I would
expect the monthly payment to be $877.47 or a rounded equivalent; that
is:
=fv(7%/365, 365/12, 0, -150000) - 150000
|
Linear Mode
