# Discrepancy in PMT function ( annual payment and monthly payment)

1. ## Discrepancy in PMT function ( annual payment and monthly payment)

Why the monthly payment multiplied by 12 is not equal to annual payment calculated with PMT funtion.

E.x:

Rate: 5%
Period: 10 years
Loan Amount: \$1,000,000

PMT(5/12,10*12,1000000)*12 is not equal to PMT(5,10,1000000)

Thanks

Discrepancy in PMT function ( annual payment and monthly payment)

2. ## Re: Discrepancy in PMT function ( annual payment and monthly payment)

https://en.wikipedia.org/wiki/Annuity

3. ## Re: Discrepancy in PMT function ( annual payment and monthly payment)

I assume you meant

PMT(5%/12, 10*12, 1000000) * 12 and PMT(5%, 10, 1000000

You pay more interest with annual rather than monthly payments.

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