Monthly principal and interest calculator excel

The tutorial shows how to use the PPMT function in Excel to calculate the payment on the principal for a loan or investment.

When you make periodic payments on a loan or mortgage, a certain part of each payment goes towards the interest (fee charged for borrowing) and the remainder of the payment goes to paying off the loan principal (the amount you originally borrowed).

While the total payment amount is constant for all periods, the principal and interest parts are different - with each succeeding payment less is applied to the interest and more to the principal.

Microsoft Excel has special functions to find both the total payment amount and its parts.

In this tutorial, we will look at how to use the PPMT function to calculate the payment on the principal.

Excel PPMT function - syntax and basic uses

The PPMT function in Excel calculates the principal portion of a loan payment for a given period based on a constant interest rate and payment schedule.

The syntax of the PPMT function is as follows: