User Manual

Lending
Loans with a constant amount paid towards Principal
•
BAL
k
= remaining balance after time period k.
•
CPMT = Constant payment to principal.
•
BAL
k
= PV - (k x CPMT)
•
Kth payment to interest = i (BAL
k
) = (PMT
i
)
k
•
Kth total payment = CPMT + (PMT
i
)
k
Add-On Interest Rate to APR
•
r = add-on rate as a decimal.
•
n = number of monthly payments.
•
APR = 1200i, where i is the solution in the following equation:
n
1 +
n
12
r
=
1 - (1 + i)
-n
i
Add-On to APR with Credit Life
•
CL = credit life as decimal.
•
AMT = loan amount.
•
FC = finance charge.
1 +
n
12
r
1 -
n
12
CL -
n
12
2
CL x r
•
G
n
= PMT
•
G x CL x n
= amount of credit life