This article describes the formula syntax and usage of the PPMT function in Microsoft Excel.
Description
Returns the payment on the principal for a given period for an investment based on periodic, constant payments and a constant interest rate.
Syntax
PPMT(rate, per, nper, pv, [fv], [type])
Note: For a more complete description of the arguments in PPMT, see PV.
The PPMT function syntax has the following arguments:
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Rate Required. The interest rate per period.
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Per Required. Specifies the period and must be in the range 1 to nper.
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Nper Required. The total number of payment periods in an annuity.
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Pv Required. The present value — the total amount that a series of future payments is worth now.
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Fv Optional. The future value, or a cash balance you want to attain after the last payment is made. If fv is omitted, it is assumed to be 0 (zero), that is, the future value of a loan is 0.
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Type Optional. The number 0 or 1 and indicates when payments are due.
Set type equal to | If payments are due |
---|---|
0 or omitted | At the end of the period |
1 | At the beginning of the period |
Remarks
Make sure that you are consistent about the units you use for specifying rate and nper. If you make monthly payments on a four-year loan at 12 percent annual interest, use 12%/12 for rate and 4*12 for nper. If you make annual payments on the same loan, use 12% for rate and 4 for nper.
Examples
Copy the example data in the following table, and paste it in cell A1 of a new Excel worksheet. For formulas to show results, select them, press F2, and then press Enter. If you need to, you can adjust the column widths to see all the data.
Data | Argument description | |
---|---|---|
10% | Annual interest rate | |
2 | Number of years for the loan | |
$2,000.00 | Amount of loan | |
Formula | Description | Result |
=PPMT(A2/12, 1, A3*12, A4) | Principal payment for month 1 of the loan | ($75.62) |
Data | Argument description | |
8% | Annual interest rate | |
10 | Number of years for the loan | |
$200,000.00 | Amount of loan | |
Formula | Description (Result) | Live Result |
=PPMT(A8, A9, 10, A10) | Principal payment for year 10 of the loan | ($27,598.05) |
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