# PPmt Function

Returns a Double specifying the principal payment for a given period of an annuity based on periodic, fixed payments and a fixed interest rate.

## Syntax

**PPmt( rate**,

**,**

*per***,**

*nper***[,**

*pv***[,**

*fv***]]**

*type***)**The

**PPmt**function has thesenamed arguments:

Part |
Description |
---|---|

rate |
Required. Double specifying interest rate per period. For example, if you get a car loan at an annual percentage rate (APR) of 10 percent and make monthly payments, the rate per period is 0.1/12, or 0.0083. |

per |
Required. Integer specifying payment period in the range 1 through .nper |

nper |
Required. Integer specifying total number of payment periods in the annuity. For example, if you make monthly payments on a four-year car loan, your loan has a total of 4 * 12 (or 48) payment periods. |

pv |
Required. Double specifying present value, or value today, of a series of future payments or receipts. For example, when you borrow money to buy a car, the loan amount is the present value to the lender of the monthly car payments you will make. |

fv |
Optional. Variant specifying future value or cash balance you want after you've made the final payment. For example, the future value of a loan is $0 because that's its value after the final payment. However, if you want to save $50,000 over 18 years for your child's education, then $50,000 is the future value. If omitted, 0 is assumed. |

type |
Optional. Variant specifying when payments are due. Use 0 if payments are due at the end of the payment period, or use 1 if payments are due at the beginning of the period. If omitted, 0 is assumed. |

## Remarks

An annuity is a series of fixed cash payments made over a period of time. An annuity can be a loan (such as a home mortgage) or an investment (such as a monthly savings plan).
The ** rate** and

**arguments must be calculated using payment periods expressed in the same units. For example, if**

*nper***is calculated using months,**

*rate***must also be calculated using months. For all arguments, cash paid out (such as deposits to savings) is represented by negative numbers; cash received (such as dividend checks) is represented by positive numbers.**

*nper*## Example

This example uses the **PPmt** function to calculate how much of a payment for a specific period is principal when all the payments are of equal value. Given are the interest percentage rate per period ( `APR / 12`

), the payment period for which the principal portion is desired ( `Period`

), the total number of payments ( `TotPmts`

), the present value or principal of the loan ( `PVal`

), the future value of the loan ( `FVal`

), and a number that indicates whether the payment is due at the beginning or end of the payment period ( `PayType`

).

```
Dim NL, TB, Fmt, FVal, PVal, APR, TotPmts, PayType, Payment, Msg, MakeChart, Period, P, I
Const ENDPERIOD = 0, BEGINPERIOD = 1 ' When payments are made.
NL = Chr(13) & Chr(10) ' Define newline.
TB = Chr(9) ' Define tab.
Fmt = "###,###,##0.00" ' Define money format.
FVal = 0 ' Usually 0 for a loan.
PVal = InputBox("How much do you want to borrow?")
APR = InputBox("What is the annual percentage rate of your loan?")
If APR > 1 Then APR = APR / 100 ' Ensure proper form.
TotPmts = InputBox("How many monthly payments do you have to make?")
PayType = MsgBox("Do you make payments at the end of month?", vbYesNo)
If PayType = vbNo Then PayType = BEGINPERIOD Else PayType = ENDPERIOD
Payment = Abs(-Pmt(APR / 12, TotPmts, PVal, FVal, PayType))
Msg = "Your monthly payment is " & Format(Payment, Fmt) & ". "
Msg = Msg & "Would you like a breakdown of your principal and "
Msg = Msg & "interest per period?"
MakeChart = MsgBox(Msg, vbYesNo) ' See if chart is desired.
If MakeChart <> vbNo Then
If TotPmts > 12 Then MsgBox "Only first year will be shown."
Msg = "Month Payment Principal Interest" & NL
For Period = 1 To TotPmts
If Period > 12 Then Exit For ' Show only first 12.
P = PPmt(APR / 12, Period, TotPmts, -PVal, FVal, PayType)
P = (Int((P + .005) * 100) / 100) ' Round principal.
I = Payment - P
I = (Int((I + .005) * 100) / 100) ' Round interest.
Msg = Msg & Period & TB & Format(Payment, Fmt)
Msg = Msg & TB & Format(P, Fmt) & TB & Format(I, Fmt) & NL
Next Period
MsgBox Msg ' Display amortization table.
End If
```