5. Amortization

This calculator can be used to calculate the principal and interest portion of a monthly installment, the remaining principal, and amount of principal and interest repaid up to any point.

uFormula

a

1 payment

c

b

1............ PM1................... PM2.......... Last Number of Payments

a: interest portion of installment PM1 (INT)

b: principal portion of installment PM1 (PRN)

c: balance of principal after installment PM2 (BAL)

e

1 payment

d

1.............

PM1................

PM2.............

Last

Number of Payments

d: total principal from installment PM1 to payment of installment PM2 (ΣPRN)

e: total interest from installment PM1 to payment of installment PM2 (ΣINT) *a + b = one repayment (PMT)

a : INTPM1 = I BALPM1–1i I (PMT sign)b : PRNPM1 = PMT + BALPM1–1i

c : BALPM2 = BALPM2–1 + PRNPM2

ΣPM2

d : PRN = PRNPM1 + PRNPM1+1 + … + PRNPM2

PM1

ΣPM2

e : INT = INTPM1 + INTPM1+1 + … + INTPM2

PM1

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