Go Premium for a chance to win a PS4. Enter to Win

x
?
Solved

Auto Loan Calculator Formula

Posted on 2013-10-25
13
Medium Priority
?
769 Views
Last Modified: 2013-10-30
Hi there,

I found this formula online, but when I use it, and compare the result to other auto loan calculators out there, my results are usually slightly lower, so I assume mine are incorrect. Here is the formula I'm using:

 
        [HttpPost]
        public ViewResult Index(double amount, double? payment, double apr, int term)
        {
            var months = term * 12;
            var pc = apr / 100;

            double dAPR = pc;
            Int32 iNumberOfPayments = months;
            double dLoanAmount = amount;

            var end = (Financial.Pmt((dAPR / 100) / 12, iNumberOfPayments, dLoanAmount, 0,  DueDate.EndOfPeriod) * -1);
            var final = String.Format("{0:00}", end);

            ViewBag.result = final;
            return View();

        }

Can someone help me out?

Thanks!
0
Comment
Question by:DonHoddinott2
  • 5
  • 4
  • 4
13 Comments
 
LVL 45

Expert Comment

by:AndyAinscow
ID: 39602284
Are the others using a daily (you use monthly) method to calculate the interest due?
0
 
LVL 45

Expert Comment

by:AndyAinscow
ID: 39606042
Where do you see the formula they use on that page ?
0
Technology Partners: We Want Your Opinion!

We value your feedback.

Take our survey and automatically be enter to win anyone of the following:
Yeti Cooler, Amazon eGift Card, and Movie eGift Card!

 

Author Comment

by:DonHoddinott2
ID: 39606085
I don't see their formula, I see that the label of the text box states that the result is monthly. Maybe if I knew why you were asking, I could help answer your question, so that you may answer my original question.
0
 
LVL 45

Expert Comment

by:AndyAinscow
ID: 39606249
because if the interest is calculated daily it will result in a different (higher) value than if calculated monthly.  (You experience a lower value than other web pages).

It is how compound interest behaves.
0
 

Author Comment

by:DonHoddinott2
ID: 39606643
Can you confirm my formula is correct?
0
 
LVL 43

Accepted Solution

by:
Rob earned 2000 total points
ID: 39607665
Can you explain why you're dividing the rate by 100 twice?

i.e.

var pc = apr / 100;
var dAPR = pc;

then in the function call

var end = (Financial.Pmt((dAPR / 100) / 12,

i believe you only need to do it the once so that it should be (to get the rate per month):

var end = (Financial.Pmt((dAPR) / 12,
0
 
LVL 43

Expert Comment

by:Rob
ID: 39607692
Ok I've confirmed this in Excel for simplicity and testing against the inbuilt PMT function:

using VBA:

Public Function MyIndex(amount As Double, apr As Double, term As Integer)
    months = term * 12
    pc = apr / 100

    dAPR = pc
    Dim iNumberOfPayments As Double
    iNumberOfPayments = months
    dLoanAmount = amount
    Dim result As Double
    
    result = Financial.Pmt(dAPR / 12, iNumberOfPayments, dLoanAmount)
    
    Debug.Print result
    
    MyIndex = result

End Function

Public Sub Test()
    MyIndex 100000, 7, 30
End Sub

Open in new window


Gives $665.30, which is exactly what the Excel formula PMT gives.  I'm guessing you were just dividing the rate by 100 one too many times :)
Please see the VBA code in the attached spreadsheet as it is a migration from your C# code but still should be the same.
PMT.xlsm
0
 

Author Closing Comment

by:DonHoddinott2
ID: 39609800
Tagit not only answered my question in a direct manner, he also followed up with a source. I very much appreciate considerate responses like his, so thank you Tagit, very much.
0
 
LVL 45

Expert Comment

by:AndyAinscow
ID: 39610833
Huh.
OK, my fault. I assumed when you said you had found the formula on line that you had not modified it so I didn't check the code.  Especially as you did explicitly say slightly lower results.  That should result in significantly lower results.
0
 
LVL 43

Expert Comment

by:Rob
ID: 39610846
Using a loan of 100,000 using a rate of 7%, 30 years and monthly repayments.

Instead of being $665 it was $280 so is that slightly lower or significantly lower?
0
 
LVL 45

Expert Comment

by:AndyAinscow
ID: 39610877
Just an addendum.
You don't seem to understand what I was asking about.  Not understanding what you are doing is very bad - you end up with no idea of what you have coded is actually giving realistic results or just plain garbage.


On a loan of 1000 for one year at 5% the monthly payment differs by a fraction of a percent (slightly different) when having the interest accrued monthly or daily.
0
 
LVL 43

Expert Comment

by:Rob
ID: 39611114
I agree and I do understand what you're saying.  :) It's a good point.  I should've said before that the important thing to note here was the the payments differed - it's irrelevant by how much when you're using a mathematical function.

When I'm unsure about something I go back to something I know and trust, which is why I used Excel.  I had a reference to use when comparing the code from DonHoddinott2.
As you've also said, it is important to know what the PMT function expects as arguments and work through and review the variables you're passing to it.
0

Featured Post

[Webinar] Cloud and Mobile-First Strategy

Maybe you’ve fully adopted the cloud since the beginning. Or maybe you started with on-prem resources but are pursuing a “cloud and mobile first” strategy. Getting to that end state has its challenges. Discover how to build out a 100% cloud and mobile IT strategy in this webinar.

Question has a verified solution.

If you are experiencing a similar issue, please ask a related question

Introduction This article shows how to use the open source plupload control to upload multiple images. The images are resized on the client side before uploading and the upload is done in chunks. Background I had to provide a way for user…
This article aims to explain the working of CircularLogArchiver. This tool was designed to solve the buildup of log file in cases where systems do not support circular logging or where circular logging is not enabled
This video shows how to quickly and easily deploy an email signature for all users in Office 365 and prevent it from being added to replies and forwards. (the resulting signature is applied on the server level in Exchange Online) The email signat…
Look below the covers at a subform control , and the form that is inside it. Explore properties and see how easy it is to aggregate, get statistics, and synchronize results for your data. A Microsoft Access subform is used to show relevant calcul…
Suggested Courses

885 members asked questions and received personalized solutions in the past 7 days.

Join the community of 500,000 technology professionals and ask your questions.

Join & Ask a Question