Excel PMT Function

PMT function is very useful for calculating monthly payment required to payback a loan or mortgage at a fixed rate. This function require a minimum of three inputs, periodic rate, number of periods, present value or the loan amount. Here is a simple example.

Home Loan: 350,000.00
Interest rate: 4.5%
Number of years to repay the loan: 25

Note: To calculate monthly payment, we need to find the monthly rate and number of months as shown above. Then it is simply a matter of substituting the values into the payment function, as shown in the formula view below.

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