How to calculate the total cost of the loan

calculate the total cost of the loan In some cases banks can make mistakes or deliberately hide the full value of the loan. To verify this information requires complex calculations. You can do this by using a written formula or calculation using Excel.

Studying the formulas that banks use when different calculations, it would seem that any borrower not under force to double-check their results. But actually it is not.

But to calculate on it not everyone can UCS people, is quite a complex calculation. Therefore it is better to resort to the help of Excel. XIRR function due to his “UCS is defined in seconds. The truth is, you need to know the schedule of payments on the loan.

Note that the first shall be the date of the loan, and in the column the first payment, you must specify the full loan amount with a minus sign. Now any cell in Excel, you must write the task type: = NPV (;), where value is a number that corresponds to a schedule of payments payments, or simply put, this is the payment amounts and dates is a schedule of payment dates that corresponds to the cash flow.

It is worth noting that in addition to the formula takes into account the loan payments and the income which can get Bank from repeated investments funds received in the form of interest and commissions on your loan.

If these calculations still seemed difficult to you, then there’s no reason to worry. The total cost of the credit can be found in the credit contract before his imprisonment. We remind, that the banks must disclose the UCS in this document. not to fret with calculations of the cost of a loan, use the credit calculator Compare.