Hi Andy, I agree that dividing the annual rate by 12 ignores the effect of compounding which might not be very significant for low interest rates and short loan terms. Before we go any further can you clarify what you mean by APR as most interest rates are quoted usin AER (annual equivalent rate) which has to take compounding into account. You can contact me off list at wd.pritchard@xxxxxxxxxxxxxx Cheers Dave From: ANDY COLLINS Sent: Sunday, April 29, 2012 8:45 PM To: access-uk@xxxxxxxxxxxxx Subject: [access-uk] Re: Calculating APR on a loan Hi Dave - just been looking and playing with the formula you sent below. I'm not sure this calculates a monthly APR rate of payment. It looks more like a flat rate of interest. I'm not sure I've understood the first numbers in the brackets, that is, in the example, the .1/12. Is that the interest rate? For example, if the APR is 14 percent, what do I do to reflect that in the formula? Many thanks - Andy ----- Original Message ----- From: david pritchard To: access-uk@xxxxxxxxxxxxx Sent: Friday, April 27, 2012 10:11 AM Subject: [access-uk] Re: Calculating APR on a loan Hi andy, I've tried sending an Excel fragment with an example of the pmt function forgetting that the list does not allow attachments.! I'm pasting a section of the Excel reference manual giving the syntax and an example below. Hope this is of some use. cheers Dave Periodic Payment Syntax: =PMT(rate,nper,pv,fv,type) The PMT function calculates the periodic payment for different types and future values (fv) of investments given the investment's rate, term (nper), and present value (pv). If no values are entered for fv and type, they are considered to be zero. You Supply: rate as the interest rate per period; nper as the total number of periods; pv as the present value; (optional) fv as the future value; (optional) type as 0 if payment is at the end of the period, or 1 if payment is at the beginning of the period. Result is: the periodic payment for a loan, expressed in a dollar amount. Example: The following formula calculates the periodic payment for a loan totaling $120,000 over 30 years at 10 percent interest: =PMT(.1/12,360,120000) The result is ($1,053.09). The result is negative because it represents the amount you pay out. From: ANDY COLLINS Sent: Wednesday, April 25, 2012 10:40 PM To: access-uk@xxxxxxxxxxxxx Subject: [access-uk] Re: Calculating APR on a loan Yes please Dave, it'd be great to be able to just put the figure in and get the results from a formula - Andy ----- Original Message ----- From: david pritchard To: access-uk@xxxxxxxxxxxxx Sent: Wednesday, April 25, 2012 9:29 PM Subject: [access-uk] Re: Calculating APR on a loan Hi Andy, You can use the PMT function in Excel. I can dig out an example if required. Regards Dave From: ANDY COLLINS Sent: Wednesday, April 25, 2012 9:09 PM To: access-uk@xxxxxxxxxxxxx Subject: [access-uk] Calculating APR on a loan Hi all - Hope I'm ok asking this here. I've been looking on some websites, and unfortunately their calculater tools for working out monthly repayments on a loan with an APR, require the sliding of a graphical bar across a grid. So, can anybody tell me how to work out monthly repayments using APR interest. Let's work with an easy example, if one borrows 10 thousand pounds, and the APR is 6 percent, how does one work out the monthly repayments over say 1 and 2 and 3 years? I can work out 6 percent of 10 grand, but it doesn't work that way, so anybody help with this one? Thanks - Andy