Amount of Payment

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The amount of the  periodic payment on a loan equals the compound interest factor (from the "amount to amortize $1 column) times the amount of the loan.


Mortgage Problem #1:


What is the monthly payment on a $100,000 loan for 15 years at 8% interest.




1.Using the 8% monthly table, locate the appropriate factor (the mortgage constant).  This is usually column 6 and is labeled "Amount to Amortize $1", "Partial Payment", or "Mortgage Constant".
2.Multiply the factor by the loan amount.
3.Payment = Mortgage Constant x Loan Amount.


Factor = 0.00955652

Payment = 0.00955652 x $100,000 = $955.65


Next Mortgage Problem (Loan Balance)

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