calculate the interest amount when loan amount is15lakhs ,tenure is 10 yrs rate of interst is 9 percent for first 5 yrs and 7 percent for last five years
Answers
Step-by-step explanation:
The results will show three things -
a. The EMI - This amount is to be paid each month till the loan is fully paid.
b. The break-up - It shows the interest portion in each month's EMI. The rest is the principal being repaid each month.
c. The amortisation schedule - The amortisation schedule shows the break-up of the interest paid and principal repaid out of the EMI each month till the end of the tenure. The outstanding balance after paying each month's EMI is also shown in the amortisation schedule. This document can be downloaded as a PDF.
How the result arrived at
The formula used for arriving at the EMI is:
EMI = [P x R x (1+R) ^n] / [(1+R)^ n-1]
Here, P= Principal loan amount, R= Rate of interest, n= Number of monthly instalments.
An example:
Assuming, P= Rs 3 lakh, R= 15 percent per annum= 15/12= 1.250 per month, N= 60 months
EMI = =((300000*1.250/100*(1+1.250/100)^60/((1+1.250/100)^60-1))) = Rs 7,137