You will need
• - credit agreement (loan agreement);
• - a sheet of paper;
• - handle;
• calculator;
• - the calendar.
Instruction
1
If the terms of the loan cash the funds must be paid in equal monthly installments at the same time, with interest for using the money, the schedule of repayment of debt is composed as follows.
To make the table with the heading of the following columns:
1) the sequential number
(2) the amount of the loan – the balance of the principal debt
3) the number of days in the current month
4) amount of redemption payments
5) the amount of interest for the current period
6) the monthly payment (column 4 plus column 5).
The number of rows in this table do in accordance with the term of the loan (number of months).
2
The loan amount divide by the number of months constituting the term of the loan. The resulting amount will be the monthly payment on the principal. Enter this amount in column 4 of your table in each row.
In column 2 (amount of the loan – the balance of the principal debt) in each subsequent row of the table gives the amount equal to the sum of previous rows of a given column minus the amount of the monthly payment on the principal.
3
The interest rate is usually a rate per annum. Thus, when calculating the amount of interest for the current period (month) take the principal amount, multiply the interest rate as a decimal (for example, the rate is 20% per annum, then for calculations take 0,20). Divide the resulting number by the number of days in the year (365 or 366 days). Then multiply by the number of days in the current (reporting) month. The final amount will be a percentage of the borrowed money for the current month. When calculating interest for the subsequent months of the principal amount subtract the amount of the payment of the principal. Calculate the percentage from the sum of the principal balance. Thus, calculate the interest amount for each month until the end of the term of the loan.
4
To calculate the monthly payment, put the amount of repayment of principal and interest amount for the current month. Similarly, calculate the monthly payment on each row of the table (for each month).
The completed table will be the schedule of repayment of debt.