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Calculate loan with Grace period

  1. #1
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    Calculate loan with Grace period

    Dear All

    i want to ask you if there are any formula to calcute loan with grace period (30,60,90 etc)


    by example
    Finance: 100,000
    Tenure months: 48
    Rate: 7.50%

    Instalement Amount =-PMT(7.50%/12,48,100000) =2,417.89
    but i want to see who to calculete with grace period>

    today is 04/9/2017 if 0 grace periode that is mean loan start from 04/10/2017 with Instalement Amount (2,417.89)
    i found in my bank system calculator that if we start after 30 or 60 or 90 the isnaltemnt will be
    04/10/2017=2433
    03/11/2017=2448
    03/12/2017=2463
    please advice iwth the formula

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    Re: Calculate loan with Grace period

    They seem to be increasing the principal by the interest earned during the "grace period".

    (Not my definition of a "grace period". But apparently, it follows loan conventions, according to online sources [1].)

    Based on that assumption, the principal would be the following for the corresponding grace periods and approximate payments:
    Please Login or Register  to view this content.
    I show the 0 grace period (row 1) to demonstrate the effect of approximating the payment.

    Note that about 0.625% is added to the principal for each grace-period month. And note that 7.5%/12 is 0.625%.

    Because only approximate payment are presented, we don't know whether simple or compounded interest is added to the principal. According to online sources [1], I would expect compounded interest. But look at the loan contract for details.

    [1] http://www.investopedia.com/terms/g/grace_period.asp
    Last edited by joeu2004; 09-08-2017 at 12:58 PM. Reason: add column E: PMT calculation; change -PV(...) to PV(...); typos in col D amts

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    Re: Calculate loan with Grace period

    Note that I added column E by editing after the original posting.

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    Re: Calculate loan with Grace period

    Try this:

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    The 3 in the formula is the number of months for grace period.

    Godspeed!
    Last edited by Estevaoba; 09-03-2017 at 08:56 PM.

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    Re: Calculate loan with Grace period

    Quote Originally Posted by joeu2004 View Post
    They seem to be increasing the principal by the interest earned during the "grace period".

    (Not my definition of a "grace period". But apparently, it follows loan conventions, according to online sources [1].)

    Based on that assumption, the principal would be the following for the corresponding grace periods and approximate payments:
    Please Login or Register  to view this content.
    I show the 0 grace period (row 1) to demonstrate the effect of approximating the payment.

    Note that about 0.625% is added to the principal for each grace-period month. And note that 7.5%/12 is 0.625%.

    Because only approximate payment are presented, we don't know whether simple or compounded interest is added to the principal. According to online sources [1], I would expect compounded interest. But look at the loan contract for details.

    [1] http://www.investopedia.com/terms/g/grace_period.asp

    Great thanks Mr joeu2004
    it seems to be done

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    Re: Calculate loan with Grace period

    Quote Originally Posted by Estevaoba View Post
    Try this:

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    The 3 in the formula is the number of months for grace period.

    Godspeed!
    Great tahnks also i understand what you mean

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