My task is to calculate the future value of constant payments at variable interest rate as follows:
Say the principal is 10,000. Annual rate is 5%. Tenor with 2 monthly period starting at Jan. The periodic payment in arrear is 1,300.
Interest for Jan is calculated as (10,000 * 5% * 31 / 360 = 43) The principal repaid is (1,300 - 43) = 1,257.
Interest for Feb is calculated as ((10,000-1,257) * 5% * 28 / 360 = 34) The principal repaid is (1,300 - 34) = 1,266.
The future value (aka balloon payment) would be 10,000 - 1,257 - 1,266 = 7,477.
So I would like to know if there is a calculation could be used to result 7,477 by inputting the above data, rather than calculate the whole repayment schedule every each time.
I tried excel formula to see if it solved the situation, and the excel formula failed:
Say the principal is 10,000. Annual rate is 5%. Tenor with 2 monthly period starting at Jan. The periodic payment in arrear is 1,300.
Interest for Jan is calculated as (10,000 * 5% * 31 / 360 = 43) The principal repaid is (1,300 - 43) = 1,257.
Interest for Feb is calculated as ((10,000-1,257) * 5% * 28 / 360 = 34) The principal repaid is (1,300 - 34) = 1,266.
The future value (aka balloon payment) would be 10,000 - 1,257 - 1,266 = 7,477.
So I would like to know if there is a calculation could be used to result 7,477 by inputting the above data, rather than calculate the whole repayment schedule every each time.
I tried excel formula to see if it solved the situation, and the excel formula failed:
- FV function: future value of constant payments at constant interest rate
- FVschedule function: future value of no payments at variable compound interest