PPMT(rate,specified_period,periods,amount<,type>)

`rate`Numeric. The interest rate per period.

`specified_period`Numeric. The period you want to find the repayment amount for.

`periods`Numeric. The number of payment periods over the term of the loan.

`amount`Numeric. The principal amount of the loan.

`type`Optional. Numeric constant. Specifies whether payments are due at the beginning or end of the period. Use the default of 0 for payments that are due at the end of a period. Use 1 for payments that are due at the beginning of a period.

Numeric.

You must use consistent units to specify rate and periods. For example, if you make monthly payments on a two-year loan at a rate of 6 percent, use 0.06/12 for rate and 2 * 12 for periods. If you make annual payments on the same loan, use 0.06 for rate and 2 for periods.

**a. Calculate a loan repayment**

To calculate the principal that you repay in the first month of a three-year, $9,600 loan at 8.5 percent annual interest, with payments due at the beginning of each month:

`PPMT(0.085/12, 1, 3*12,
9600, 1)`

returns **300.92**. The principal that
you repay is $300.92.

**b. Calculate a mortgage repayment**

To calculate the principal that you repay in the last year of a twenty-five-year, $275,000 mortgage at 6.5 percent annual interest:

`PPMT(0.065,
25, 25, 275000)`

returns **21168.93**. The principal
that you repay is $21168.93.