Help with rate comparison

[YoDadio]

My apologies in advance if my "mathematical grammar" is not up to par...

If I give a $20,000 loan for 60 months at 5.00% the monthly payment will be $377.42 and the total interest will be $2,645.48 (using the pmt formula).

What would my "net profitability rate" be if I were to offer the same loan terms but only netted $2,445.48 (paying 1% of the original principal as a commission)?

Perhaps I should have worded it as "all things being equal, how do I determine the loan rate based on two different amounts of total interest paid?"

Hopefully this will make sense to someone...

[Kaper]

Use RATE (good name for function, isn't it?)

So: monthly it would be:

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and yearly 4.6352165%:

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You can test it either taking 4.6352165% into PMT formula or with:

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where you will (as expected) get 5% as a result

[YoDadio]

Thanks Kaper, that is exactly what I am looking for!

[YoDadio]

What is the formula to get the total amount of interest on a given loan (i.e., $20,000 at 5% for 60 months)

[Kaper]

Hi,
For instance:

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I'd suggest reading description of excel financial functions - for instance look at list by category: http://www.vertex42.com/ExcelArticle...functions.html then formal/official description of each function: https://support.office.com/en-us/art...rs=en-US&ad=US