Monday, April 23, 2007

Formulae to calculate Home-Loan Interest rates

Rate % = R
Tenure in Years = T
Tenure in month = n = T*12
Loan Amount = P
ROI per month = r = R/12/100
EMI = E = ( P*r*(1+r)n )/((1+r)n - 1)
Total Paid to Bank in Year = A = E*12
Balance at the beginning of every month = BP
Interest paid in a month= I = r*BP
Principle Paid in a month = PR = E - I
Pre-Payments if any in a particular month = PP
Balance principal at the end of the month = BE = BP + I - E - PP

I even have an excel calculator that would calculate all this for you. Let me know if you need it.

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