Financial
Technology Center - School of Business
- Central Connecticut State University
A
homeowner just obtained a $90,000 mortgage. The mortgage is for 30
years (360 months) and has a fixed nominal annual rate of 9 percent,
with monthly payments. What is the amount of the 12th payment
allocated to interest and the amount allocated to principle and the
remaining balance of the loan? What is the total interest paid by
that time? what is the amount paid to principle by that time?
Financial calculator solution.
The loan amortization function is used to find the remaining
balance, principle, and interest paid, of a loan with equal end of
the month payments.
bal (npmt ) computes the balance for an amortization schedule npmt
is the number of the payment at which you want to calculate a
balance
Prn ( pmt1 , pmt2 ) computes the sum of the principal during a
specified period for an amortization schedule . pmt1 is the starting
payment. pmt2 is the ending payment in the range
Int ( pmt1 , pmt2 ) computes the sum of the interest during a
specified period for an amortization schedule pmt1 is the starting
payment. pmt2 is the ending payment in the range
First Step will be to find the amount of the equal monthly payments.
What is the amount of the 12th payment allocated to interest?
Int ( 12 , 12 ) =$670.79
What is the amount of the 12th payment allocated to principle?
Prn ( 12 , 12 ) =$53.37
the remaining balance of the loan at the 12th payment?
bal (12) = $89,385
What is the total interest paid by that time?
Int ( 1 , 12 ) =$8,075.05
what is the amount paid to principle by that time?
Prn ( 1 , 12 ) =$614.88