subject: Compound Interest Table And Changing Interest Rates [print this page] Did you know that the compound interest table that is the outcome of the compound interest formula, is used in amortization schedules? That is right. The table is used as a reminder, and a learning tool to keep our loan experience better than the chaotic expectation we have of it.
Learn The Changing Of Interest Rates Clearly With The Use Of The Compound Interest Table
If you are buying a house using a loan, then there is a big probability that the rates will change depending on your banks or the lender. With a calculator that has a compound interest table as a time frame with it, you will know the monthly payments you have to make together with the compound interest table as your amortization schedule. The good thing with this is the rate of interest can be altered. There are also some calculators that come with features like additional payments. You can also check the rates using a certain formula but most of the time the rates are entered manually because they are given by the lender themselves to you, the loaner.
Compound interest table and graphs made via MS Excel
The calculator with the compound interest table is made using the program Microsoft Excel. Through the program, the calculator is able to make a compound interest table based on the entered details and of course the use of functions and formulas. There are even some calculators that use the compound interest table to create graphs to make the amortization schedule more attractive and understandable. This would be very helpful especially if the rates are adjustable in the loan. With the compound interest table turned to graphs, the user will clearly see how big or small the difference is it with the change of interest rate. There are also calculators that have additional payments feature. Again, with the compound interest table and graphs, the user will be able to understand more on the benefits that the extra payments can give.
Loans with adjustable interest rates
This type of calculators can give and estimation of how the loan will be paid off even with the changing rates of interest. There are some loans which only have a constant rate of interest for a certain number of years then there will be the changing of the rate every year. This just means that your monthly dues will be changed as well together with the rates. This is why the calculator comes in handy. It is able to give you not only the estimated monthly dues but a schedule together with it.
Here, is a tip. If you bought a house using a loan, then your first payments are really low, you should expect to have a higher rate of interest in the long run. There are also times wherein the rates are high then you should expect to have lower rates by the latter years. With the use of the calculator together with the compound interest table then, you can estimate and prepare yourself of the expenditures you will have with the loan and no charges here because most calculators come for free!
