 How to​ Actually Calculate Loan Payments
Acquiring loans is​ a​ comparatively simple task compared to​ the​ difficulty in​ calculating the​ loan payments .​
It is​ necessary that you​ can make a​ few of​ these calculations by yourself rather than always having to​ depend on​ the​ lender to​ provide you​ with the​ exact figures .​
One of​ the​ best and easiest methods of​ calculating your loan interest is​ with the​ help of​ the​ Internet.
There is​ a​ difference when calculating interest for mortgages,​ car loans,​ credit cards etc.,​ so you​ will have to​ select the​ right calculator that suits your needs .​
In this way,​ you​ can ensure that the​ calculations provided are accurate.
A mortgage calculator helps you​ calculate the​ amount that you​ are capable of​ borrowing which will help you​ in​ your purchase of​ property .​
These calculators can also be used to​ calculate and compare the​ interest rates and the​ costs of​ various loans .​
Apart from checking costs you​ can calculate the​ effect repayment has on​ your finances when the​ time of​ payment differs .​
This will help you​ reach a​ decision on​ whether you​ want to​ make bi-weekly payments or​ monthly payments.
If there are changes that may affect repayment of​ the​ loan,​ you​ are able to​ calculate the​ extra damage it​ can cause to​ your cash flow .​
These calculators help you​ to​ calculate and clear all your queries regarding interest rates,​ affordability,​ and changes in​ the​ terms that will affect the​ loan etc .​
To a​ certain extent,​ the​ calculator will also help you​ to​ find the​ loan that fits your requirements.
If you​ are considering or​ have already taken up the​ Home Equity Line Of Credit (HELOC),​ which follows the​ variable interest rate then a​ mortgage calculator will also help you​ determine the​ payments you​ will be required to​ make .​
These calculators will help you​ calculate the​ payments on​ all types of​ loans be it​ with fixed interest rates,​ variable interest rates and even amortized loans .​
It provides you​ with all the​ different calculations that you​ may require to​ make the​ right decision.
You also have the​ option of​ doing it​ yourself by using an​ excel sheet on​ your computer by applying the​ right formula .​
The formula that you​ can use in​ your excel sheet is​ the​ Pmt Formula.
=Pmt (Rate,​ Nper,​ PV) formula
where
Nper is​ the​ number of​ payments and
The commonly used formulas that are used for calculating loan payments are as​ follows:
PMT (Rate,​ Nper,​ -Loan Amount)
PPMT (Rate,​ Which Period,​ Nper,​ -Loan Amount)
NPER (Rate,​ Pmt,​ -Loan Amount)
RATE (Nper,​ Pmt,​ -Loan Amount)
PV (Rate,​ Nper,​ Pmt)
However it​ is​ the​ online calculators that allows for easy and accurate calculations. 