# Loan Balance Formula

To know the Loan Balance,  including the current payment, interest and term remaining – Loan balance calculator is used. To know the amount remaining to be repaid by the borrower in a certain time, then Loan Balance formula is used. The banks provides loan with easy repayment option that is called the equated monthly installments. Equated monthly installments are devised in such a way that the borrowers pays back to the lender (banks/financial institutions etc) without being heavy for the pocket and the interests is also taken care of.

Find loan balance formula below,

$\large B=(A(1+r)^n)-[(\frac{p}{r})((1+r)^n)-1]$

Where,
B = Balance Amount
A = Loan Amount
P = Payment Amount
r = Rate of Interest (compounded)
n = Number of time periods

### Solved Examples

Question: Find the balance loan after 1 year, when the original loan amount is $10000, payment amount is$ 900 and annual interest rate of 4%?

Solution:

Given Original loan amount A = 10000B = Balance Amount
A = 10,000
P = 900.00
r = 0.04
n = 01 years

Using the loan formula:

$B=(A(1+r)^n)-[(\frac{p}{r})((1+r)^n)-1]$

$B=(10000(1+0.04)^1)-[(\frac{900}{0.04})((1+0.04)^1)-1]$

B = $2487.10 Hence the balance amount after an year =$ 2487.10