mortgage formula

Hi, is this the correct formula to calculate mortgage interest on an
interest only mortgage?
=SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
Thanks Ron

You don't need the sum, and you don't need to multiply by -1, and assuming
that the interest is calculated annually, then

=-(B3*B4)/12

--

HTH

RP
(remove nothere from the email address if mailing direct)


"Ron" <[email protected]> wrote in message
news:uJfz%[email protected]...
> Hi, is this the correct formula to calculate mortgage interest on an
> interest only mortgage?
> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
> Thanks Ron
>
>

"Bob Phillips" <[email protected]> wrote in message
news:[email protected]...
> You don't need the sum, and you don't need to multiply by -1, and assuming
> that the interest is calculated annually, then
>
> =-(B3*B4)/12
>
> --
>
> HTH
>
> RP
> (remove nothere from the email address if mailing direct)
>
>
> "Ron" <[email protected]> wrote in message
> news:uJfz%[email protected]...
>> Hi, is this the correct formula to calculate mortgage interest on an
>> interest only mortgage?
>> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
>> Thanks Ron
>>

Hi thanks for the quick reply however I have just had a notice from my
mortgage company, as the interest rate is decreasing and their calculations
for a mortgage of £45397.72 and an interest rate of 5.6%, gives a monthly
payment of £210.91, whereas my formula gives £211.83. They must use a
different formula.

As there is a shortfall in my endowment I was trying to find out the
difference in paying money into my mortgage account as against using an ISA
to make up the shortfall.



Ron

Are you sure it is 5.6%, not 5.575%.

--

HTH

RP
(remove nothere from the email address if mailing direct)


"Ron" <[email protected]> wrote in message
news:[email protected]...
>
> "Bob Phillips" <[email protected]> wrote in message
> news:[email protected]...
> > You don't need the sum, and you don't need to multiply by -1, and
assuming
> > that the interest is calculated annually, then
> >
> > =-(B3*B4)/12
> >
> > --
> >
> > HTH
> >
> > RP
> > (remove nothere from the email address if mailing direct)
> >
> >
> > "Ron" <[email protected]> wrote in message
> > news:uJfz%[email protected]...
> >> Hi, is this the correct formula to calculate mortgage interest on an
> >> interest only mortgage?
> >> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest
rate.
> >> Thanks Ron
> >>
>
> Hi thanks for the quick reply however I have just had a notice from my
> mortgage company, as the interest rate is decreasing and their
calculations
> for a mortgage of £45397.72 and an interest rate of 5.6%, gives a monthly
> payment of £210.91, whereas my formula gives £211.83. They must use a
> different formula.
>
> As there is a shortfall in my endowment I was trying to find out the
> difference in paying money into my mortgage account as against using an
ISA
> to make up the shortfall.
>
>
>
> Ron
>
>

"Bob Phillips" <[email protected]> wrote in message
news:[email protected]...
> Are you sure it is 5.6%, not 5.575%.
>
> --
>
> HTH
>
> RP
> (remove nothere from the email address if mailing direct)
>
>
> "Ron" <[email protected]> wrote in message
> news:[email protected]...
>>
>> "Bob Phillips" <[email protected]> wrote in message
>> news:[email protected]...
>> > You don't need the sum, and you don't need to multiply by -1, and
> assuming
>> > that the interest is calculated annually, then
>> >
>> > =-(B3*B4)/12
>> >
>> > --
>> >
>> > HTH
>> >
>> > RP
>> > (remove nothere from the email address if mailing direct)
>> >
>> >
>> > "Ron" <[email protected]> wrote in message
>> > news:uJfz%[email protected]...
>> >> Hi, is this the correct formula to calculate mortgage interest on an
>> >> interest only mortgage?
>> >> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest
> rate.
>> >> Thanks Ron
>> >>
>>
>> Hi thanks for the quick reply however I have just had a notice from my
>> mortgage company, as the interest rate is decreasing and their
> calculations
>> for a mortgage of £45397.72 and an interest rate of 5.6%, gives a monthly
>> payment of £210.91, whereas my formula gives £211.83. They must use a
>> different formula.
>>
>> As there is a shortfall in my endowment I was trying to find out the
>> difference in paying money into my mortgage account as against using an
> ISA
>> to make up the shortfall.
>>
>>
>>
>> Ron

on the letter it says 5.6%
Ron

What is the amortization period of the mortgage and the conversion periods (i.e. is the
rate compounded monthly/semi annually...).


--
Regards;
Rob
------------------------------------------------------------------------
"Ron" <[email protected]> wrote in message news:uJfz%[email protected]...
> Hi, is this the correct formula to calculate mortgage interest on an
> interest only mortgage?
> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
> Thanks Ron
>
>

"RWN" <[email protected]> wrote in message
news:[email protected]...
> What is the amortization period of the mortgage and the conversion periods
> (i.e. is the
> rate compounded monthly/semi annually...).
>
>
> --
> Regards;
> Rob
> ------------------------------------------------------------------------
> "Ron" <[email protected]> wrote in message
> news:uJfz%[email protected]...
>> Hi, is this the correct formula to calculate mortgage interest on an
>> interest only mortgage?
>> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
>> Thanks Ron
>>

Does it matter what the amortization period of the mortgage is on an
interest only mortgage? It has about 6 years left until the first endowment
is paid. The interest is calculated daily. I wondered why the mortgage
company had a different monthly payment from me. As I said in an earlier
post they must use a different formula.
Ron

I'd go with Bob's suggestion that the rate is probably 5.575%. On your
document, I would think they've used 5.6% as a convenience. As the actual
rate used seems to be lower, you're not losing :-)

--
Andy Wiggins FCCA
www.BygSoftware.com
Excel, Access and VBA Consultancy
-

"Ron" <[email protected]> wrote in message
news:[email protected]...
>
> "RWN" <[email protected]> wrote in message
> news:[email protected]...
> > What is the amortization period of the mortgage and the conversion
periods
> > (i.e. is the
> > rate compounded monthly/semi annually...).
> >
> >
> > --
> > Regards;
> > Rob
> > ------------------------------------------------------------------------
> > "Ron" <[email protected]> wrote in message
> > news:uJfz%[email protected]...
> >> Hi, is this the correct formula to calculate mortgage interest on an
> >> interest only mortgage?
> >> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest
rate.
> >> Thanks Ron
> >>
>
> Does it matter what the amortization period of the mortgage is on an
> interest only mortgage? It has about 6 years left until the first
endowment
> is paid. The interest is calculated daily. I wondered why the mortgage
> company had a different monthly payment from me. As I said in an earlier
> post they must use a different formula.
> Ron
>
>

Are payments at start or end of month?
--
Bernard V Liengme
www.stfx.ca/people/bliengme
remove caps from email

"Ron" <[email protected]> wrote in message
news:uJfz%[email protected]...
> Hi, is this the correct formula to calculate mortgage interest on an
> interest only mortgage?
> =SUM((B3*B4)/12)*-1 where B3 is the mortgage and B4 is the interest rate.
> Thanks Ron
>
>