Calculate the Loan Amount for a given Monthly Payment where the Balloon Payment is a Percentage of the Loan Amount

How do you calculate a balloon payment?

We can use the below formula to calculate the future value of the balloon payment to be made at the end of 10 years: FV = PV*(1+r)ⁿ–P*[(1+r)ⁿ–1/r] The rate of interest per annum is 7.5%, and monthly it shall be 7.5%/12, which is 0.50%.

How do you calculate your monthly total loan payment?

To calculate the monthly payment, convert percentages to decimal format, then follow the formula:

1. a: $100,000, the amount of the loan.
2. r: 0.005 (6% annual rate—expressed as 0.06—divided by 12 monthly payments per year)
3. n: 360 (12 monthly payments per year times 30 years)

How do you calculate loan repayment percentage?

Calculation

1. Divide your interest rate by the number of payments you’ll make that year. …
2. Multiply that number by your remaining loan balance to find out how much you’ll pay in interest that month. …
3. Subtract that interest from your fixed monthly payment to see how much in principal you will pay in the first month.

How do I calculate a balloon payment in Excel?

Set up your equation.



The function that will be used here in the payment function, abbreviated by Excel as PMT. To enter this equation, find a nearby empty cell and type “=PMT(“. The program will then prompt you for variables like this: =PMT(rate, nper, pv, [fv], [type]).

What is a balloon payment example?

Typically, a balloon payment would represent a percentage of the purchase price of the vehicle. For example, for a car costing R300 000, a 20 % balloon payment would work out at R60 000. This would be paid in one lump sum at the end of the contract period – for example 60 months or five years after purchase.

What does balloon mean in a loan?

A balloon loan is a type of loan that does not fully amortize over its term. Since it is not fully amortized, a balloon payment is required at the end of the term to repay the remaining principal balance of the loan.

What is the formula of loan calculation?

Great question, the formula loan calculators use is I = P * r *T in layman’s terms Interest equals the principal amount multiplied by your interest rate times the amount in years.

How can calculate percentage?

1. How to calculate percentage of a number. Use the percentage formula: P% * X = Y

1. Convert the problem to an equation using the percentage formula: P% * X = Y.
2. P is 10%, X is 150, so the equation is 10% * 150 = Y.
3. Convert 10% to a decimal by removing the percent sign and dividing by 100: 10/100 = 0.10.

How do you calculate total loan amount?

Total amount paid with interest is calculated by multiplying the monthly payment by total months. Total interest paid is calculated by subtracting the loan amount from the total amount paid. This calculation is accurate but not exact to the penny since, in reality, some actual payments may vary by a few cents.

What is balloon payment schedule?

This large amount is called a balloon payment, which pays down the remaining balance when the term ends. A balloon mortgage has a short term that does not fully amortize, but the payment is usually based on a 30-year amortization schedule. Balloon mortgages are usually associated with commercial real estate loans.

What is a 5 year balloon loan?

A balloon mortgage is usually rather short, with a term of 5 years to 7 years, but the payment is based on a term of 30 years. They often have a lower interest rate, and it can be easier to qualify for than a traditional 30-year-fixed mortgage.

How do I calculate loan duration in Excel?

Quote:
Quote: So let's take the value in c2. And divided by 12 to get the monthly. Interest rate and then nper that's going to be the number of payments that we're going to apply to this loan.

How do you you calculate percentages in Excel?

The percentage formula in Excel is = Numerator/Denominator (used without multiplication by 100). To convert the output to a percentage, either press “Ctrl+Shift+%” or click “%” on the Home tab’s “number” group. Let us consider a simple example.

How do I calculate a loan payment in Excel?

Excel PMT Function

1. Summary. …
2. Get the periodic payment for a loan.
3. loan payment as a number.
4. =PMT (rate, nper, pv, [fv], [type])
5. rate – The interest rate for the loan. …
6. The PMT function can be used to figure out the future payments for a loan, assuming constant payments and a constant interest rate.