PMT
Calculates the periodic payment amount for a loan or investment based on constant payments and a constant interest rate. Use PMT to determine how much you'll pay (or receive) per period for mortgages, car loans, or recurring investments.
Syntax
PMT(rate, periods, present_value, [future_value], [type])
rate(Number): The interest rate per period.periods(Number): The total number of payment periods.present_value(Number): The current value (loan amount or investment).future_value(Number, optional): Desired balance after the last payment (default = 0).type(Number, optional): Timing of payments – 0 = end of period (default), 1 = beginning.
Returns
Number – The payment amount per period. Result is negative for outgoing payments and positive for incoming cash flows.
Examples
Calculate monthly mortgage payment
PMT(0.045/12, 360, 300000)
//Using references the function would look like this:
PMT(RATE/12, PERIOD, PRINCIPLE)Returns -1520.06, meaning you pay $1,520.06 each month for a 30-year, $300,000 loan at 4.5% annual interest.
Determine regular investment contributions
PMT(0.06/12, 240, 0, 500000)Calculates how much you must save monthly to reach $500k in 20 years at 6% annual growth.
Assess lease or financing scenarios
PMT(0.08/12, 36, 25000)Gives the monthly payment for a 3-year car loan of $25,000 at 8% interest.
Common Mistakes & Tips
Remember: rate must match the payment period (monthly, quarterly, etc.).
Loan payments are returned as negative (cash outflow).
Combine with IPMT() to separate interest from principal.
See Also
FV · IPMT · CUMIPMT · IRR