With amortizing loans – like car loans and home loans – you’re expected to make payments on a regular basis according to something called an amortization schedule. While your credit card statement will include a minimum payment amount, there’s no date set in advance for when that credit card debt has to be paid off. For example, applying for a credit card is akin to applying for a loan. Over time, your lender will use a greater share of your car payments to reduce your principal loan balance (and a smaller percentage to pay for interest) until you’ve completely paid off the vehicle you purchased. What you’ll soon discover is that your car payments – at least in the beginning – cover quite a bit of interest. With each payment, your money is split between paying off interest and paying off your principal balance (or the amount that your lender agreed to lend you). In order to do that, you’re required to make a payment every month by a certain due date. This article describes how this spreadsheet calculates interest payments (the article is targeted at mortgages, but the theory and math is exactly the same).Amortization is the process of repaying a loan on a set schedule. Just change the compounding period to suit! This flexibility means that you can use this calculator internationally. This alters the amount of each payment, and the total interest paid at the end of the loan.

Australian loans are compounded monthly.

Canadian loans are compounded monthly or sometimes semi-annually.

So what this this auto payment calculator do better than the other calculators you can find littering the Internet? Well, you can change the compounding period of the loan. This tool also generates a payment schedule, giving the date of each payment (and the interest and principal paid of every payment, and the balance). Watch me use the spreadsheet in this video.

and the total interest and principal paid at the end of the loan.Just enter the loan amount, interest rate, loan term, first payment date, payment frequency and loan compounding periodĪAfter you click a button, the spreadsheet calculates your The spreadsheet is easy to use and navigate required parameters are highlighted, and drop-down menus let you change the payment frequency and compounding period. You can also investigate how changing your loan conditions (such as the payment frequency or the term) affects the payment.

It calculates your car loan payments and generates a payment schedule. Want to know how much that new car will cost? Just crack open Excel and load this spreadsheet.

Car loan amortization schedule excel