You can make the loan amortization schedule table
, calculate the annuity loan
, calculate the amount of interest
, calculate the annual percentage rate
What is loan amortization schedule table?
Loan amortization schedule
table is the plan of repayment of the loan and is usually annexed to the treaty on taking a loan. It contains the following information:
Details of the credit :
- loan amount
- interest rate
- transfer date
- number of annuities
- monthly annuity amount
- amount of any potential costs
- method of interest calculation
- annuity amount
- amount of the effective interest rate
Information on the individual maturity:
- serial number
- Amount of loan repayment
When do we need loan amortization schedule table?
Amortization schedule is needed when renting each loan, as it indicates the obligations that come with renting a loan. Especially useful information is the balance, which always tells us how high our debt is. It is wrong to believe that when we pay back half of the annuities, we have paid off half the debt. In fact annuity consists of interest and payment of debt. Because of high debt at beginning of repayment time also the interest rates are high. As the debt is getting lower also interest rate is getting lower and the share, which means repayment of loan, is increasing. Ratio between interests and repayment can be seen on chart.
Why do we need loan amortization schedule table?<
In amortization plan are all financial information related to the loan. In addition to basic information such as the amount of the loan, interest amount and the interest rate, there is a very important balance on a given day, which tells us how much do we owe at certain date.
Which information must be included in the loan amortization schedule table?
To make an amortization schedule we need the following information:
date of transfer
number of annuities
how many months of annuity
the amount of potential costs
method of interest calculation
All other data, which are an integral part of the amortization schedule, are found by the program.
An annuity is an amount that the borrower in equal installments (monthly, quarterly, semi-annual, annual) returns to the lender. Each installment consists of interest and repayment, this is the amount by which the payment of each installment reduces the debt.
The calculation of the effective interest rate.
Since there are differences in meaning of what is the effective interest rate, I will use the term “Rate For Money”. Some consider that the effective interest rate is the rate which was calculated with compound method. The second one is the rate at which the costs of the loan are also taken into account and the compound was applied method of calculation.
In our case, we mean the effective interest rate, which includes the costs. This information is very important because it represents the real price of the loan and is the best indicator for the comparison of large loans. The calculation is very difficult because there is no formula, but we have to find it . We are looking to recalculate all transfers and returns of the same day. That discount rate at which the sum of the calculated transfers and repayments equals, is a measure of money.