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# PMT options in C#

Posted on 2004-08-20
Medium Priority
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THis is my question i am converting some old vb6 project to C#. One uses the pmt function. I know that if i Microsoft.VisualBasic as a reference i can use this same function. Most people are not happy with me using this.
so here is the function i found

present value = 10000, financial period is 119 months and interest rate is = .129
public  Double calculate_Amount(double presentValue,  double
financingPeriod,
double interestRatePerYear)
{
try
{
double a, b, x,g;
double monthlyPayment;
double vbMnthlyPayment;
a = (1 + interestRatePerYear / 12);
b = financingPeriod;
x =   Math.Pow(a, b);
x = 1 / x;
x = 1 - x;
//this is the C# way i get a value of  149.33
monthlyPayment = (presentValue ) * (interestRatePerYear / 12) / x;
// this is the vb way      i get a value of 150.94
vbMnthlyPayment = Microsoft.VisualBasic.Financial.Pmt(interestRatePerYear/12,financingPeriod,-(presentValue*(1+interestRatePerYear/12)),0,0);
return(monthlyPayment);

The vb reference  is that amount that i need to keep conistent but i dont know how to change the C# function to return the same answer

0
Question by:Steege
• 3

LVL 10

Accepted Solution

eternal_21 earned 1000 total points
ID: 11856567
Multiply your result by

(1 + (interestRatePerYear / 12))

And your numbers will match.

The reason for this is that the Microsoft.VisualBasic.Financial.Pmt method can calculate the interest BEFORE the payment or AFTER the payment is made each month.  As you have described it the Due parameter (the last one) is 0.  0 tells the Pmt method to calculate interest before the payment, and a 1 tells the Pmt method to calculate the payment before the interest.

So, your formula is fine if you are making your payment at the start of the month, but if you are paying at the end (and interest has accrued), then you need to multiple your result by (1 + (interestRatePerYear / 12)). (The actual math is a little more complex, but if you expanded the whole amortization formula, you would find that it all works out nice and neat in the end!)
0

LVL 10

Expert Comment

ID: 11856751
And here it is in a nice little method.  Keep in mind that rate is the rate per period (compound), so interestRatePerYear / 12:

double Payment(double rate, double period, double presentValue)
{
return presentValue*rate/(1 - 1/Math.Pow(1 + rate, period))*(1 + rate);
}

Payment(0.01075d, 119d, 10000d) = 150.942458894686
0

LVL 10

Expert Comment

ID: 11860267
I don't understand why you are using this as the parameter for "present value":

presentValue*(1+interestRatePerYear/12)
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