How Amortization is Calculated in Quicken

Quicken's amortization features use the following formulas to calculate payments, principal, and interest for a loan.

where

n = number of periods per year

y = total years

r = interest rate per period, given by this formula:

Similarly, if you enter the principal, Quicken calculates the payment amount as follows:

Payment schedules: To calculate each line in your payment schedule, Quicken uses the following formulas to base each amount on the principal remaining (as shown in the Balance column on the previous line of the schedule):

Interest payment = r multiplied by Remaining principal

Payment against principal = Total payment minus Interest payment

Note: If your loan company uses some other formula to calculate interest rate per period, Quicken's amortization calculations do not accurately reflect your loan.