#1. What Is the PMT Function in Excel the PMT Function in Excel The PMT function in Excel stands for "Payment." It's a powerful tool used for calculating periodic loan payments, making it particularly useful for tasks involving mortgages, loans, and investments. This function assists in dete...
This Excel tutorial explains how to use the Excel PMT function with syntax and examples. The Microsoft Excel PMT function returns the payment amount for a loan based on an interest rate and a constant payment schedule.
The PMT Function In Excel Is Useful Understanding how the PMT function works in Excel can help you measure how long it’ll take to pay off a loan if you pay a certain amount, or depending how the interest rate changes. How The PMT Function in Excel Works The PMT function is much simpl...
=PMT(B2/12,C2, -A2) Here are some observational notes using the PMT function in Excel Notes: The function returns #NUM! Error when: The given rate value is less than or equal to -1. The given nper value is equal to 0. The function returns #VALUE! error when any of the arguments...
Example 4 – Create a Loan Payment Calculator Applying the PMT Function in Excel Consider a 5-year loan amount of $110,000 with a 3% interest rate. Steps: Enter the loan details in C4:C7 and prepare two lookup tables: Period (F5:G9) and Type (F11:G12). Create a drop-down list ...
Monthly payment This cell is calculated by Excel using the PMT function, don't enter a value here. The formulas in columns E, F, G, H and I resize appropriately based on the values you enter in C2:C4. The calculator returns: the number of months (periods) in column E the equal paym...
Next, add the formula for which you have a goal. For the example, use the PMT function: In cell B4, type=PMT(B3/12,B2,B1). This formula calculates the payment amount. In this example, you want to pay $900 each month. You don't enter that a...
Drag down the Fill Handle to see the result in the rest of the cells. Read More:How to Calculate Present Value in Excel with Different Payments Example 5 – Using the PMT Function to Determine a Payment Per Period In the dataset below,Present Value,Annual Rate,Number of Years, andFuture ...
equivalent to the PMT function in the Excel spreadsheet program. For additional information on the calculation of capital recovery factors see Chan Park, Fundamentals of Engineering Economics, 2004, Chapter 2; or Eugene Grant, et al., Principles of Engineeringth ...
Let’s find the answer to this sample problem using the PV function in Excel. Lay out the data on a spreadsheet like the one above, and use the formula below to calculate the PV: =PV(12%/12, 3, -100) Since the NPER and PMT values are on a monthly interval, the formula divides ...