# 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 these named 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'll 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, \$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 nper arguments must be calculated using payment periods expressed in the same units. For example, if rate is calculated using months, nper 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.

## 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 new line.
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``````