All Topics / General Property / Helpful repayment formula

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• Truska
Member
@truska
Join Date: 2003
Post Count: 20

Hi all

I’m not sure if this has been posted before.

Here’s a formula I use to quickly calcute how much a loan is going to cost me to repay with respect to actual weekly repayments. It really helps if you’re looking at a property and need to quickly calculate your outgoings.

The formula works using the following parameters

Interest rate 6.75%
Term 30yrs (360 monthly repayments)

You take your purchase price
Divide by 1000
multiply by 1.5 (or add 1/2 of this amount)
this equals your weekly repayment.

If you take this figure,mutiply by 52, then divide by 12, you will be within a few dollars of the banks monthly repayments

eg purchase price
\$80,000
divided by 1000 = \$80
multiply by 1.5 = \$120 (or add \$40 to your \$80)
weekly out of pocket repayment is \$120
x 52 =\$6240
divided by 12 =\$520

Bank figure is \$518.88
_________________________
for \$300 000

weekly repay is \$450 = \$1950pm
bank figure is\$1945.79

The result is always a bit over, but at least it helps make a quick on-the-spot decision re cash flow

T

Billfromoz
Participant
@billfromoz
Join Date: 2003
Post Count: 381

G’ay Truska…

Well done!

Have you also done a multiplyer for 7%-9%?
What about 15,20 and 25 years?

Be interested if you have…if not a little job for you.

Thanks

Bill

Bill O’Mara
Real Estate,Mortgages,Share Market Strategies.
[email protected]

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