Use the Quicken 2015 Loan Calculator to Figure Payments
To help you better manage your debts, Quicken provides a neat Loan Calculator that computes loan payments and balances. Suppose that one afternoon, you’re wondering what the mortgage payment is on one of those monstrous houses: tens of thousands of square feet, acres of grounds, cottages for the domestic help, and so on. You get the picture — something that’s a really vulgar display of wealth.
To calculate what you would pay on a 30-year, $5,000,000 mortgage if the money costs 5 percent, use the Loan Calculator:
Display the Loan Calculator.
Click the Planning tab. Click the Planning Tools button to display Quicken’s list of financial calculator tools. Then choose the Loan Calculator. Quicken displays the Loan Calculator dialog box. (The figure shows a picture of this handy tool.)
Enter the loan amount.
Move the cursor to the Loan Amount text box and type the amount of the loan. (If you’re checking the lifestyle of the ostentatious and vulgar, type 5,000,000.)
Enter the annual interest rate.
Move the cursor to the Annual Interest Rate text box and type the interest rate percent. If a loan charges 5 percent interest, for example, type 5.
Enter the number of years you want to take to repay the loan.
Move the cursor to the Number of Years text box and type the number of years you plan to make payments.
Indicate how many loan payments you plan to make per year.
Move the cursor to the Periods per Year text box and type the number of loan payments you plan to make per year. If you want to make monthly payments, for example, type 12.
Indicate how frequently the lender will calculate, or compound, interest.
Move the cursor to the Compounding Period text box and select the interest compounding period. If a loan uses monthly compounding, for example, select Monthly. (By the way, just so you know, most loans use compounding periods equal to the payment period. Some don’t. But most do.)
Click Calculate or move the selection cursor.
Quicken calculates the loan payment and displays the amount in the Payment field.
Hey, wait: $26,841.08. That doesn’t seem so bad, does it? That’s a monthly payment, isn’t it? Yikes! If you have to ask how much the mortgage payment is, you really can’t afford it.
To get more information on the loan payments, interest and principal portions of payments, and outstanding loan balances, click the View Schedule button, which appears on the face of the Loan Calculator dialog box. Quicken whips up a quick loan amortization schedule showing all this stuff.