# Loan Amortization - Exact Day Monthly

Most amortization formulas calculate loans based upon the loan being divided into 12 equal periods. From this premise it follows that the monthly interest factor is constant each month. For an annual interest rate of 12% with monthly compounding, the monthly interest factor is .01% each and every month. I need a formula written in VB that will take into consideration the exact number of days between payments to calculate the monthly interest factor each month, which in turn is used to calculate the interest for that month. Example: On a \$5,000,000 dollar loan for 240 months at 10% interest the conventional amortization method would compute a monthly loan payment of \$48,253.08 with a last payment of \$48,253.08. Through trail and error, an "exact day monthly" method would compute a monthly payment of \$48,737.08 and a last payment of \$48,321.81. This method would take into consideration the variation of days in the month as well as leap years. Summary: I need a formula simialr to "pmt" in VB that computes the monthly payment using the "exact day monthly" method. Something Extra: See this link for an amortization program that I have used as a template ==> [url removed, login to view] program: [url removed, login to view] Update 10/1/2002: I have included a work in progress to help move along this process. The code does about 80% of the customer's requirements. It falls short in these areas: * Monthly Payment Size - Too large, leaving a large gap between the last payment and regular monthly payment. * Maxmium Values - Problems handling large loan amounts (>\$5m, >15%, and terms > 30 years) * Negative Amortization - Too large a monthly payments causes the loan to be payed off to quickly (less than term) Hope this helps, Hope this description was clear. I will be in the chat room today (10/1/02) off and on today. P.S. - Please provide me with a description on how you would approach the problem. Be general enough not to give away your secrets, but specific enough to convince me of your understanding of the problem. Thanks

## Deliverables

0)The success of the formula is determine by these factors: * The computed monthly payment results in a last payment that is less than the monthly payment (no ballon payment at the end of the term) * Similar to "pmt" in Visual Basic, the formula uses as input: Rate, Loan Amount, Term, Starting payment date. * The code used to compute the monthly payment is efficient. In other words, no excessive looping that could effect performance. * The code will work on a range of loan min / max values: - Loan Amounts: \$10,000 - \$100,000,000 - Terms: 12 months - 960 months or greater - Interest Rates: 1% - 30% * The code should not product negative amortization. * The actual number of payments should equal to the term of the loan (not less than or greater than). 1) Complete and fully-functional working program(s) in executable form as well as complete source code of all work done. 2) Installation package that will install the software (in ready-to-run condition) on the platform(s) specified in this bid request. 3) Complete ownership and distribution copyrights to all work purchased.

## Platform

Windows 2000

Om arbejdsgiveren:
( 3 bedømmelser ) United States

Projekt ID: #2873403

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