Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP Posting-Version: version B 2.10.2 (Tek) 9/28/84 based on 9/17/84; site tekchips.UUCP Path: utzoo!watmath!clyde!burl!ulysses!mhuxr!mhuxt!houxm!vax135!cornell!uw-beaver!tektronix!tekcrl!tekchips!stevev From: stevev@tekchips.UUCP (Steve Vegdahl) Newsgroups: net.math,net.invest Subject: Re: Trivial Interest-Calculation Formula Needed Message-ID: <356@tekchips.UUCP> Date: Sat, 9-Nov-85 01:42:40 EST Article-I.D.: tekchips.356 Posted: Sat Nov 9 01:42:40 1985 Date-Received: Sun, 10-Nov-85 09:26:42 EST References: <719@hou2e.UUCP> Distribution: net Organization: Tektronix, Beaverton OR Lines: 41 Xref: watmath net.math:2500 net.invest:858 > I posted this request in net.invest but got no response (yet), so I'll >try here on net.math. This should be duck-soup for this group ! > > I am writing a spread-sheet program to calculate present and future return >on investment properties. I would like a formula which gives the >total-interest paid to-date on a current loan with monthly payments. Let P = principal I = *monthly* interest rate (i.e., annual interest rate divided by 12) N = term of the loan in *months* Define S = P / ((1+I)^N - 1) The amount paid toward the principal after M monthly payments is Q(M) = (S * (1+I)^M) - S The monthly payment is D = I*(P+S) Thus, the total interest paid after M monthly payments is total off all payments - total amount that went toward principal = M*D - Q(M) Example: P = 100000 I = 0.01 (i.e., 12% *annual* interest) N = 360 (i.e., 30-year loan) M = 50 (i.e., we want to know total interest paid through 50 months) then S = 2861.259693 Q(M) = 1844.459048 D = 1028.612597 so the total interest paid is (M*D)-Q(M) = 51430.62985 - 1844.459048 = 49586.1708 Steve Vegdahl Computer Research Lab. Tektronix, Inc. Beaverton, Oregon