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Loan with first year repayment holiday?

  1. #1
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    Loan with first year repayment holiday?

    Hi.

    I would like to calculate payments for a 6 year loan with the first year on a repayment holiday.

    I have a spreadsheet which works well, complete with amortisation table, for loans with a standard repayment structure. However, this is at present unable to calculate the interest which accrues over the twelve month repayment holiday.

    Can anyone advise how this can be accomplished, or point me in the direction of a downloadable spreadsheet which will do this?

    An illustrative loan;
    £100,000 loan amount.
    6 year total repayment period.
    Year 1 repayment holiday (interest-only payments).
    Monthly payments in arrears.

    Thanks.

  2. #2
    Forum Expert Greg M's Avatar
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    Re: Loan with first year repayment holiday?

    Hi there,

    See if the attached workbook does what you need. It contains two worksheets - one shows a repayment schedule for a situation with no repayments during the holiday period, and one shows a schedule for interest-only repayments during the holiday period.

    Hope this helps - please let me know how you get on.

    Regards,

    Greg M
    Attached Files Attached Files
    Last edited by Greg M; 07-13-2019 at 12:53 PM. Reason: Original post amended

  3. #3
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    Re: Loan with first year repayment holiday?

    On reflection, I cannot see why interest should accrue during the twelve month repayment holiday when interest-only payments are being made. I wonder whether the accountant overlooked the interest payments.

    I will double-check with the accountant - unless I have overlooked something?
    Last edited by Jacks; 07-14-2019 at 01:05 AM. Reason: Updated information

  4. #4
    Forum Expert Greg M's Avatar
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    Re: Loan with first year repayment holiday?

    Hi again,

    If you look at Sheet2 of the workbook I posted previously you will see that interest does NOT accrue during the holiday period, i.e. the balance (100,000) at the end of the holiday period is the same as it was at the start of the loan.

    Sheet1 of the workbook shows that interest accrues from month to month only if repayments (0 in the case illustrated) made during the holiday period are insufficient to cover the monthly interest charges.

    Regards,

    Greg M

  5. #5
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    Re: Loan with first year repayment holiday?

    Quote Originally Posted by Greg M View Post
    Hi again,

    If you look at Sheet2 of the workbook I posted previously you will see that interest does NOT accrue during the holiday period, i.e. the balance (100,000) at the end of the holiday period is the same as it was at the start of the loan.

    Sheet1 of the workbook shows that interest accrues from month to month only if repayments (0 in the case illustrated) made during the holiday period are insufficient to cover the monthly interest charges.

    Regards,

    Greg M
    Thank your for your advice.

    In view of your comments your workbook provides everything that I need. Much appreciated.

    Kind regards,

    Pete

  6. #6
    Forum Expert Greg M's Avatar
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    Re: Loan with first year repayment holiday?

    Hi again,

    Many thanks for your feedback - I'm glad I was able to help.

    Regards,

    Greg M

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