interest payments and loan amortization

[ecstasy]

First off sorry if this is in the wrong section

Ok i have this problem, its a 12 year business loan worth $1million APR is 10%

I was asked to prepare a loan Amortization table and then asked
find the ration total interest payments to total repayments over the 12 years

I think i've worked out the loan repayments

PVA Factor: (1-91/(1+0.1)^12))/0.1) = 6.81
loan payments is 1mil/6.81 = 146842.88

but im getting stuck on the interest ratio part, is it as simple as 10% * 1million (then multiply this by 12 years?) or is there another formula i need to use! 😱

thanks again for any help

 

[porph]

Is the interest charged daily, monthly, annually?

If annually, I would lay it out: Y1 opening balance 1m, interest 10% * 1m = 100,000
First payment = 146842, closing balance 953158.

Y2 opening balance 953158, interest 10%*953158 95315.8, 2nd payment=146842, closing balance 901631.8 etc etc

That assumes that the interest is charged before the payment and not in arrears.

 

[Mr. Charts]

There might be something if you google, "loan amortization calculator".

 

[zambuck]

Auto Loan Calculator - Free Auto Loan Payment Calculator for Excel

....I use these for my business or purchasing calcs, but banks figures come out slighly different for some odd reason..!

 

[Technically Fundamental]

On the loan agreement you should have a page which will tell you the total interest payable on the loan. share these by 144 (12months x 12 years) and there is your average. Working smart beats working hard mate.

IMO its impossible to work out how a banks calculate interest unless you work for one or have a banking maths qualification

 

[zambuck]

....Ah well I am glad for once that I don't have Banking Maths Calculation knowledge...!....because they don't seem to have 'loss' calculation buttons on their methods...!