FV Function Problem
I'm doing an auto loan amortization and getting conflicting results with
similar Excel functions. I'm looking at a GM loan of 1.9% for 4 years on a loan of $32,000, and trying to obtain the total cost of loan, P+I. If I do a FV(0.019/12,48,,32000,0) I get $34,524. However, if I use several online auto loan calculators I get $33,257. I can obtain the latter result by using $32,000 + CUMIPMT(0.019/12,48,32000,1,48,0). But shouldn't the FV calculation agree, or am I incorrect in trying to use a compound interest formula with an amortization application? BTW, CUMIPMT requires the Analysis Toopak Addin. Thanks!! Terry |
This file might be a help:
http://www.bygsoftware.com/examples/...Calculator.zip ... except that it arrives at a figure of $34,432. This file also shows the loan replayment schedule. It's in the "Accountants" section on page: http://www.bygsoftware.com/examples/examples.htm This workbook includes two worksheets that can help you calculate the likely repayments you will have to make on mortgages and personal loans (including HP and conditional sale agreements). -- Andy Wiggins FCCA www.BygSoftware.com Excel, Access and VBA Consultancy - "TerryG" wrote in message ... I'm doing an auto loan amortization and getting conflicting results with similar Excel functions. I'm looking at a GM loan of 1.9% for 4 years on a loan of $32,000, and trying to obtain the total cost of loan, P+I. If I do a FV(0.019/12,48,,32000,0) I get $34,524. However, if I use several online auto loan calculators I get $33,257. I can obtain the latter result by using $32,000 + CUMIPMT(0.019/12,48,32000,1,48,0). But shouldn't the FV calculation agree, or am I incorrect in trying to use a compound interest formula with an amortization application? BTW, CUMIPMT requires the Analysis Toopak Addin. Thanks!! Terry |
The reason you are getting different results is becase when you use CUMIPMT
excel is assuming that you are paying down your debt every month for 48 months and hence each successive months interest cost keeps coming down and thus total interest paid is only 1257. However when using FV the principal gets simply compunded ( no paying down of loan) and is therefore higher than above "TerryG" wrote in message ... I'm doing an auto loan amortization and getting conflicting results with similar Excel functions. I'm looking at a GM loan of 1.9% for 4 years on a loan of $32,000, and trying to obtain the total cost of loan, P+I. If I do a FV(0.019/12,48,,32000,0) I get $34,524. However, if I use several online auto loan calculators I get $33,257. I can obtain the latter result by using $32,000 + CUMIPMT(0.019/12,48,32000,1,48,0). But shouldn't the FV calculation agree, or am I incorrect in trying to use a compound interest formula with an amortization application? BTW, CUMIPMT requires the Analysis Toopak Addin. Thanks!! Terry |
That's what I suspected, but wasn't sure. Thanks very much for your reply!!
Terry "N Harkawat" wrote: The reason you are getting different results is becase when you use CUMIPMT excel is assuming that you are paying down your debt every month for 48 months and hence each successive months interest cost keeps coming down and thus total interest paid is only 1257. However when using FV the principal gets simply compunded ( no paying down of loan) and is therefore higher than above "TerryG" wrote in message ... I'm doing an auto loan amortization and getting conflicting results with similar Excel functions. I'm looking at a GM loan of 1.9% for 4 years on a loan of $32,000, and trying to obtain the total cost of loan, P+I. If I do a FV(0.019/12,48,,32000,0) I get $34,524. However, if I use several online auto loan calculators I get $33,257. I can obtain the latter result by using $32,000 + CUMIPMT(0.019/12,48,32000,1,48,0). But shouldn't the FV calculation agree, or am I incorrect in trying to use a compound interest formula with an amortization application? BTW, CUMIPMT requires the Analysis Toopak Addin. Thanks!! Terry |
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