How+to+use+PMT+function

 =**Excel: Pmt Function**=

In Excel, the **Pmt** function returns the payment amount for a loan based on an interest rate and a constant payment schedule. The syntax for the **Pmt** function is:

Pmt( interest_rate, number_payments, PV, FV, Type ) //interest_rate// is the interest rate for the loan. //number_payments// is the number of payments for the loan. //PV// is the present value or principal of the loan. //FV// is optional. It is the future value or the loan amount outstanding after all payments have been made. If this parameter is omitted, the Pmt function assumes a //FV// value of 0. //Type// is optional. It indicates when the payments are due. //Type// can be one of the following values:


 * ~ Value ||~ Explanation ||
 * 0 || Payments are due at the end of the period. (default) ||
 * 1 || Payments are due at the beginning of the period. ||

If the //Type// parameter is omitted, the Pmt function assumes a //Type// value of 0.


 * Applies To:**
 * Excel 2007, Excel 2003, Excel XP, Excel 2000

Let's take a look at a few examples: This first example returns the monthly payment on a $5,000 loan at an annual rate of 7.5%. The loan is paid off in 2 years (ie: 2 x 12). All payments are made at the beginning of the period.
 * For example:**

=Pmt(7.5%/12, 2*12, 5000, 0, 1)

This next example returns the weekly payment on a $8,000 loan at an annual rate of 6%. The loan is paid off in 4 years (ie: 4 x 52). All payments are made at the end of the period.

=Pmt(6%/52, 4*52, 8000, 0, 0)

This next example returns the annual payment on a $6,500 loan at an annual rate of 5.25%. The loan is paid off in 10 years (ie: 10 x 1). All payments are made at the end of the period.

=Pmt(5.25%/1, 10*1, 6500, 0, 0)

This final example returns the monthly payment on a $5,000 loan at an annual rate of 8%. The loan is paid on for 3 years (ie: 3 x 12) with a remaining balance on the loan of $1,000 after the 3 years. All payments are made at the end of the period.

=Pmt(8%/12, 3*12, 5000, 1000, 0)