The rapid growth of the lending market that has taken place over the past decade, in particular, lending to individuals, has definitely led to a certain increase in the financial literacy of people. Indeed, in order to use loans, you need to plan cash flows and imagine what payments will be made of. In order to understand the structure of payments more deeply, and at the same time to check if there are any hidden fees in the amount of payments, we will calculate the loan payments ourselves.
It is necessary
engineering calculator, pencil and sheet of paper
Instructions
Step 1
The most common in the practice of lending to small businesses and individuals is the annuity payment. This is such a payment, the amount of which is the same throughout the entire duration of the loan agreement.
An annuity payment structurally consists of 2 parts: credit and interest. During the term of the loan, their relationship changes. At the beginning, interest prevails in the payment, at the end, the main share is a loan.
You can calculate loan payments using the following formula:
P = C × (i × (1 + i) ^ n) / ((1 + i) ^ n - 1)
P is the amount of payment
С - loan amount
i is the interest rate
n - the number of terms of interest accrual
Step 2
Let's calculate the payment on a loan of 150,000 rubles, taken for 60 months at 21% per annum.
An important point. Interest rate i of the number of interest calculation periods. In our example, the loan term is 60 months, and the rate is 21% per annum. For use in the calculation, we recalculated the annual rate into the monthly rate: 21/12 = 1.75. And converted it to decimal fractions, ie 0, 0175.
Substitute the values into the formula:
P = 150,000 × 0.0175 × (1 + 0.0175) ^ 60 / ((1 + 0.0175) ^ 60 - 1)
We receive a monthly payment:
P = 4'058, 00 (rub.)
Step 3
But when concluding a loan agreement, the payment schedule is made on specific days. Therefore, for an accurate calculation of payments, the annual interest rate is converted to a daily one, that is, divided by 365 days. In this case, accordingly, the number of periods for calculating interest, that is, the value of n, also increases.
There is a difference when used in calculating the monthly and daily interest rates, but not much. Usually it fluctuates within a few tens of rubles in the amount of payment.
If you are good at Excel, you can build an analogue of a bank payment schedule in which you can calculate payments with an accuracy of the day. At the same time, do not forget the main rule of lending: interest is charged on the remaining amount of debt. Thus, you will know exactly how much you overpay for using the loan, and easily calculate the presence of hidden fees, if any.
