# The Money Mustache Community

## Learning, Sharing, and Teaching => Real Estate and Landlording => Topic started by: AlienRobotAnthropologist on May 05, 2017, 03:03:11 PM

Title: Mortgage Math
Post by: AlienRobotAnthropologist on May 05, 2017, 03:03:11 PM
I understand that with a mortgage, the early payments are mostly against the loan's interest, while the later payments are progressively against more of the principle. For a given mortgage, how do you calculate the amount of a given payment that will be applied to the interest vs the principle?
Title: Re: Mortgage Math
Post by: maizefolk on May 05, 2017, 03:13:49 PM
The concept you're describing is the Amortization Schedule. There are a bunch of calculators online (example: https://financial-calculators.com/amortization-schedule), or, with that search term, you can dig into the math behind calculating it.
Title: Re: Mortgage Math
Post by: maizefolk on May 05, 2017, 07:28:22 PM
http://www.myamortizationchart.com/articles/how-is-an-amortization-schedule-calculated/
Title: Re: Mortgage Math
Post by: cakie on May 05, 2017, 07:30:04 PM
In google sheets, the formula to use is ppmt for principle and ipmt for interest. You can make up your own amortization table like this. I assume the formulas are similar in excel
Title: Re: Mortgage Math
Post by: MDM on May 05, 2017, 11:24:23 PM
http://www.myamortizationchart.com/articles/how-is-an-amortization-schedule-calculated/
+1

And for the derivation, see one of amortization derivation - Google Search (https://www.google.com/search?q=amortization+derivation&ie=utf-8&oe=utf-8).