IPMT Function

[Guest]

I need to calculate monthly payments on a loan that is interest payments
only. The interest rate is 5.25%, 30 year loan, balance of $600,000. How do I
do this with the IPMT function? I have entered =IPMT(5.25%/12,1,360,600,000)
and get nonsense. Can someone advise me on what it is I am doing wrong?

 

[Guest]

Kyoo1;

High finance is definetely not my area but here is what I got.

=IPMT(5.25%/12,1,360,600,000) == ($26.25)

I thought that it might be the case that you did not want the , in the
600000(Excel recognizes this as a "Take the next step in the calculation
process" delimiter.).

=IPMT(5.25%/12,1,360,600000) == ($2625.00)

You might also want to consider placing your interest in a separate field.
This will allow you to modify the interest rate without damaging the equation
you want.

a1 = 5.25%, a2 = 12, a3 = a1/a2, Formula is now

=IPMT(a3,1,360,600000) == ($2625.00)

I hope this helps.

God Bless

Frank Pytel

 

[Ron Rosenfeld]

I need to calculate monthly payments on a loan that is interest payments
only. The interest rate is 5.25%, 30 year loan, balance of $600,000. How do I
do this with the IPMT function? I have entered =IPMT(5.25%/12,1,360,600,000)
and get nonsense. Can someone advise me on what it is I am doing wrong?

Since the loan is Interest Only, you don't really need the IPMT function

A1: $600,000
A2: 5.25%

Pmt: =A1*A2/12

If you WANT to use the IPMT function, then you need to set PV and FV equal, so:

=IPMT(A2/12,1,360,-A1,-A1)


--ron

 

[Guest]

Thanks, Ron for your help.

Since the loan is Interest Only, you don't really need the IPMT function

A1: $600,000
A2: 5.25%

Pmt: =A1*A2/12

If you WANT to use the IPMT function, then you need to set PV and FV equal, so:

=IPMT(A2/12,1,360,-A1,-A1)


--ron

 

[Guest]

Thank you, Frank. Your suggestions were helpful.

Kyoo1;

High finance is definetely not my area but here is what I got.

=IPMT(5.25%/12,1,360,600,000) == ($26.25)

I thought that it might be the case that you did not want the , in the
600000(Excel recognizes this as a "Take the next step in the calculation
process" delimiter.).

=IPMT(5.25%/12,1,360,600000) == ($2625.00)

You might also want to consider placing your interest in a separate field.
This will allow you to modify the interest rate without damaging the equation
you want.

a1 = 5.25%, a2 = 12, a3 = a1/a2, Formula is now

=IPMT(a3,1,360,600000) == ($2625.00)

I hope this helps.

God Bless

Frank Pytel