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How to calculate a monthly loan payment in Excel and Google Sheets
Topic:Finance basicsExcel & Google Sheets
=PMT(B2/12,C2*12,-A2)✓
Verified example
Computed by a real spreadsheet engine on the sample data below.
| Loan Amount | Annual Rate | Years | Monthly Payment |
| 200000 | 0.05 | 30 | |
| 15000 | 0.07 | 5 | |
| 8000 | 0.06 | 3 | |
| 50000 | 0.045 | 10 |
=PMT(B2/12,C2*12,-A2)→1073.6432460243
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Step by step
- 1Create three columns: Loan Amount (A), Annual Interest Rate (B, as a decimal like 0.05), and Loan Term in Years (C).
- 2In the Monthly Payment column, enter =PMT(B2/12,C2*12,-A2). B2/12 gives the monthly rate; C2*12 converts years to months; negating A2 returns a positive payment.
- 3Press Enter and format the cell as Currency. The result is your fixed monthly payment for the loan.
Tips
- Wrap the formula in ABS() if you prefer to avoid the negative sign: =ABS(PMT(B2/12,C2*12,-A2)).
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Frequently asked
What if the loan has a balloon payment at the end?
Add the future value (FV) argument to PMT: =PMT(B2/12,C2*12,-A2,FV) where FV is the balloon amount as a negative number.
How do I see how much of each payment is interest vs. principal?
Use IPMT for the interest portion and PPMT for the principal portion. These take the same arguments as PMT plus the period number.
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