Excel Loan Amortization Schedule With Fixed Principal Payments In Texas
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Using Excel Functions for Simplicity IPMT: This calculates the interest portion of a specific payment. The formula looks like this: =IPMT(interest_rate/12, period, total_periods, -loan_amount) PPMT: This calculates the principal portion of a specific payment.
The PMT function in Excel determines the total payment owed each period—inclusive of the interest and principal payment. The total payment, unlike the other two components, will remain constant over the entire borrowing term.
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Key Excel functions (PMT, PPMT, IPMT) are used to calculate total payments, principal, and interest for each period in an amortization schedule.
Even a single extra payment made each year can reduce the amount of interest and shorten the amortization, as long as the payment goes toward the principal and not the interest. Just make sure your lender processes the payment this way.
Fortunately, Excel can be used to create an amortization schedule. The amortization schedule template below can be used for a variable number of periods, as well as extra payments and variable interest rates.
