Calculates the payment on a loan.
Syntax:
PMT(principal:number, interest:number, term:number)
where:
principal | is the amount of the loan; |
interest | is the rate of the interest; |
term | is the term of the loan (number of periods). |
To calculate monthly payments given an annual percentage rate and a term in years, divide the annual interest rate by 12 and multiply the number of years by 12.
Formula:
PMT = principal × ( interest ÷ (1 − (1 + interest)−term) )
Example:
What is the monthly repayment on a loan of £150,000, with 10% annual interest and a term of 20 years?
The formula
PMT(150000, 0.10/12, 20*12)
returns the monthly payment of 1447.53
(pounds).