5th
January
2007
Math Geek Answer … Math is weird.
posted in General |Nobody wanted to explain loan amortization to me, huh?
So the formula for calculating my monthly payment is: monthly = (amount borrowed) * (interest*(interest+1)^periods ) / (interest+1)^periods -1… or, with the values I’m working with, monthly= 900 * (0.04 * 1.04^13)/1.04^13 -1, or about $90 dollars a month.
You can do the same math using a spreadsheet, or you can use the handy-dandy loan amortization calculator. Oddly, the results I get aren’t even as close as my second try at approximation. I must be doing something wrong. And those numbers don’t really jibe with the one I get from the Amortization Calculator link above (which gave a monthly payment closer to $82).
