Amortized Loan Calculator

When purchasing a new home, most buyers choose to finance a portion of the purchase price via the use of a mortgage. Amortized Loan (also known as mortgage) calculators are used to determine monthly repayments. The major variables in a mortgage calculation include outstanding loan, tenure of loan years, number of compounding per year, interest rate, monthly (total) repayment.

Amortized loan calculator

Mortgage Amount (Outstanding loan) – The original principal on a new loan or principal remaining on an existing loan.
Tenure of loan years – number of years for the mortgage loan.
Number of compounding per year – The number of payments required to repay the loan.
Interest Rate – The annual nominal interest rate, or stated rate of the loan.
Total (Monthly) Payment – The amount to be paid toward the loan at each monthly payment due date which includes the principal repayment plus the interest paid in each month.

Amortized Loan Formula

Principal repayment = P * (r / n) * (1 + r/n)^t*n / [(1 + r/n)^t*n - 1] - P * (r/n)
Interest paid = P * (r/n)
Total repayment = P * (r/n) * (1 + r/n)^t*n / [(1 + r/n)^t*n - 1]

Example

Suppose a house mortgage with an outstanding amount of $6,400,000 of loan that tenure in 20 Years. There are 12 compoundings per year and the interest rate paid is 6.5%. The principal repayment, interest paid and total repayment are $13,050.01, $34,666.67, $47,716.68, respectively.