Mortgage Calculator in Excel

Mortgage Payment Loan Calculator in Excel

The mortgage is nothing but your car loan, home loan, bike loan, or any other loan taken. If you search on google about mortgage loan calculator in excel you will find plenty of online websites which can help in this.

However, in this article, I will show you how to build a mortgage loan calculator template in excel. This article covers all the things you need to know about loan calculator with a ready excel template at your plate.

Factors Involved in Mortgage Payment Calculator in Excel

Assume you are taking a loan to buy your dream car, you need to look into several factors which affect your monthly EMI. Every loan includes the rate of interest, loan tenure, loan amount, and down payment (if any). There are financial institutions who give a loan without down payment as well but at a higher interest rate. For the better understanding look at the below example.

Mr. Peter wants to buy a bike which is costing him 85,000 overall. But he is short of money and decided to go for a loan with one of the bank. Bank decided to give 100% loan for the bike. Loan duration is for 2 years at an interest rate of 18% per anum.

• Loan Amount = 85000
• Interest Rate = 18% PA.

Note: When the interest rate is per anum we need to convert it to per month by dividing the interest rate by 12. In this case interest rate is 18/12 i.e. 1.5% per anum.

• Loan Duration = 2 years i.e. 2*12 = 24 months.

These are the basic factors involved in any kind of excel mortgage loan calculator. Using this information we can calculate monthly EMI amount to decide whether we need to go for a loan or not.

Mortgage Payment Calculator in Excel Formula

Like many other excel mortgage calculator formulas, we have the formula to calculate the monthly EMI amount as well. In order to calculate the monthly EMI in excel, we have a built-in function called PMT function.

PMT function includes 3 mandatory and 2 optional parameters.

• Rate: This is nothing but the interest rate applicable for the loan. If the interest is per anum then you need to convert this to monthly payment by just dividing the interest rate by 12.
• Nper: This is simply the duration of the loan. In how many EMI’s you are going to clear the loan. For example, if the loan tenure is for 2 years then loan tenure is 24 months.
• Pv: This is the present value of loan amount you are taking. Simply the borrowing money i.e. loan mount.

All the above three parameters are good enough to calculate the monthly EMI but on top this we have two other optional parameters as well.

• [FV]: This is the future value of the loan. If you ignore this default value will be zero.
• [Type]: This is nothing but whether the loan repayment is at the start of the month or at the end of the month. If it is at the start then the argument is 1 and if the payment is at the end of the month then the argument will be zero (0). By default, the argument will be zero.

Examples of Mortgage Payment Calculator

Mr. A wants to buy a car and the cost of the car is Rs 600,000. He approached the bank and bank agreed to sanction the loan based on the below conditions.

• Down Payment: Rs150,000
• Loan Tenure: 3 years and above
• Interest Rate: 15% PA.

Now Mr. A wants to evaluate his monthly savings and decide on the loan taking possibilities. In excel using the PMT function, we can calculate the EMI.

Step 1: Enter all this information in Excel.

Step 2: Open PMT function in B7 cell.

Step 3: First thing is the rate, so interest rate select B6 cell. Since the interest rate is per anum we need to convert it to month by dividing the same by 12.

Step 4: NPER is the number of payments to clear the loan. So loan tenure is 3 years i.e. 3*12 = 36 months.

Step 5: PV is nothing but loan amount Mr. A taking from the bank. Since this amount is a credit given by the bank we need to mention this amount is negative.

Step 6: Close the bracket and hit enter. We have an EMI payment per month.

So, in order to clear the loan of Rs 450,000 in 3 years at an interest rate of 15% Mr. A has to pay Rs15,599 per month.

Mortgage Loan Calculator Excel Template

In the above example, we have seen the simple method to calculate the loan monthly repayment amount. The above just showed the monthly amount required to clear off the loan, but I have built a template which will give the complete breakup of the principal amount, interest amount and how much extra you have paid in detail.

You need to download the workbook and you need to fill the orange colored cells. All the green colored cells will have a formula and work automatically.

Things to Remember

• You need to fill the only orange colored cell.
• Loan amortization table will show the breakup of Principal Amount and Interest Amount each month.
• It will also show you the extra amount you are paying as a percentage.

Recommended Articles

This has been a guide to Mortgage Calculator in Excel. Here we discuss how to prepare a mortgage loan payment calculator using PMT Formula along with practical examples and downloadable excel template. You may learn more about excel from the following articles –

• PMT Formula in Excel
• Inventory Excel Template
• Mortgage Formula
• Excel Range Function in VBA
• Mortgage Amortization Schedule
• IPMT in Excel
• Mortgage APR vs Interest Rate – Compare
• PPMT in Excel