Calculating mortgage interest in Python

Question

I am currently learning python through a video tutorial on youtube, and have come up against a formula I cannot seem to grasp, as nothing looks right to me. The basic conc

Answer 1

I also watched this youtube video and had the same problem. I'm a python newbie so bear with me. The instructors in the video were using python3 and I am using python2 so I am not sure if all the syntax are the same. But using some information found in this thread and info from this link: (http://www.wikihow.com/Calculate-Mortgage-Payments) I was able to get the answer. (My calculations matched an online mortgage calculator)

#!/usr/bin/env python
# The formula I used:
M = L * ((I * ((1+I) ** n)) / ((1+I) ** n - 1))

# My code (probably not very eloquent but it worked)

# monthly payment
M = None
# loan_amount
L = None
# interest rate
I = None
# number of payments
n = None

L = raw_input("Enter loan amount: ")
L = float(L)
print(L)

I = raw_input("Enter interest rate: ")
I = float(I)/100/12
print(I)

n = raw_input("Enter number of payments: ")
n = float(n)
print(n)

M = L * ((I * ((1+I) ** n)) / ((1+I) ** n - 1))

M = str(M)
print("\n")
print("Monthly payment is " + M)

Answer 2

This worked pretty well for me. Not exact, as loan calculators usually go by days, and I'm lazy so I go by months but here's a simple one I wrote that is accurate enough to be practical.

L = input("How much will you be borrowing? ")
L = float(L)
print(L)


N = input("How many years will you be paying this loan off? ")
N = float(N) *12
print(N)

I = input("What is the interest in percents that you will be paying? Ex, 10% = 10, 5% = 5, etc. ")
I = float(I)/100
print(I)

M = (L/N) + I*(L/N)

float(M) 
print("Your monthly payment will be: ")
print(M)

Answer 3

Apparently you copied the formula wrong.

wrong:   * numberOfPayments 

correct: ** numberOfPayments 

note: it appears twice in the formula note: in python, ** is "to the power of" operator.

Answer 4

With the help of examples, this is what I did.

# Formula for mortgage calculator
# M = L(I(1 + I)**N) / ((1 + I)**N - 1)
# M = Monthly Payment, L = Loan, I = Interest, N = Number of payments, ** = exponent

# Declares and asks for user to input loan amount. Then converts to float
loanAmount = input('Enter loan amount \n')
loanAmount = float(loanAmount)

# Declares and asks user to input number of payments in years. Then converts to float. Years * 12 to get
#  total number of months
years = input('How many years will you have the loan? \n')
years = float(years) * 12

# Declares and asks user to input interest rate. Then converts to float and input interest rate is /100/12
interestRate = input('Enter Interest Rate \n')
interestRate = float(interestRate) / 100 / 12

# Formula to calculate monthly payments
mortgagePayment = loanAmount * (interestRate * (1 + interestRate)
                                ** years) / ((1 + interestRate) ** years - 1)

# Prints monthly payment on next line and reformat the string to a float using 2 decimal places
print("The monthly mortgage payment is\n (%.2f) " % mortgagePayment)

Answer 5

I also came accross this problem and this is my solution

loan = input('Enter Loan Amount: ')
loan = float(loan)

numberOfPayments = input('Enter Loan payments in years: ')
numberOfPayments = float(numberOfPayments) * 12

interest = input('Annuel interest Rate: ')
interest = float(interest)/100/12

monthlyPayments = loan * (interest * (1 + interest) ** numberOfPayments) / ((1 + interest) ** numberOfPayments - 1)

print (round(monthlyPayments))

Answer 6

This mortgage package does it nicely:

>>> import mortgage
>>> m=mortgage.Mortgage(interest=0.0375, amount=350000, months=360)
>>> mortgage.print_summary(m)
                     Rate:      0.037500
             Month Growth:      1.003125
                      APY:      0.038151
             Payoff Years:            30
            Payoff Months:           360
                   Amount:     350000.00
          Monthly Payment:       1620.91
           Annual Payment:      19450.92
             Total Payout:     583527.60