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,

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

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%?


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 = $ 2487.10

Hence the balance amount after an year = $ 2487.10

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