Loan Amortization templates

What is a loan amortization schedule?

Amortization is the act of spreading out the payment of a loan. This process specifies the series of fixed payments over time; typically these payments will be made monthly. When taking out a loan or a mortgage, calculating the necessary payments can be a difficult task. It is thus useful to use an amortization schedule which includes an amortization calculator, in order to plan and list these payments.

To 'amortize' is to pay off. An loan amortization schedule excel spreadsheet will include both the principle (amount borrowed) and the interest. An amortization template will calculate your payment amount after it has received information on the principle, interest rate, time length of the loan, and the frequency required for payment.

What are the different types of loan amortization?

There are a range of loan amortization excel templates, depending on the type of loan that is taken out, some of which include:

-Balloon Loan Amortization Schedule: This type of loan scheduling sees the majority of the loan principle paid off in one go at the end. This comes after several smaller payments are made. This calculation will deliver the amortization schedule along with the balloon payment.

-Bullet Loan: This type of loan, similar to a balloon loan amortization schedule is where the entire principle of the loan is paid at the end of the loan period. Throughout the loan period it is possible to pay only the interest on the loan amount.

-Auto Loan Amortization Schedule: This type of loan schedule is used to calculate the costs of purchasing a car. It incorporates many different costs, including sales price and tax, trade-in rebate price, initial down payments, and other extra fees associated with the purchasing of a vehicle.

-Home Equity Loan Amortization Schedule: Often used synonymously with the term 'second mortgage', a home equity loan amortization calculation shows the amount of equity you have in a property at different point in time. This will help to give the homeowner information regarding how long it will take to pay off the loan, how much equity will be built up by a certain period if, for example, a sale is planned, and what happens if the original value of the house drops.

Why are loan amortization schedule excel templates useful?

There are a number of reasons as to why amortization schedules are extremely useful.

For example, they allow the user to see the actual cost of the loan, beyond the principle, i.e. the interest added.

Additionally, those looking to take out a loan can more effectively compare the lenders, and their offers, whilst also gaining information regarding the potential savings of paying off the loan before it is due.

If you wish to learn more about loan amortization schedule excel templates, please visit the webpages via these links:

Find descriptions of different types of loan amortization schedules

Explanation about amortization

Loan Calculators

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