Loan Balance Formula
Loan Balance Formula
The Loan Balance formula is used to determine the loan balance, including the current payment, interest rate, and period left. The Loan Balance formula is used to determine the amount remaining to be repaid by the borrower over a certain period. Banks provide a loan with a manageable repayment option known as equated monthly payments. Equated monthly instalments are designed in such a way that the borrower repays the lender without breaking the bank, and the interest is also paid. Students will learn about some of the most significant topics that as the Loan Balance formula, as well as how to compute them. Students can refer to the study resources provided by the Extramarks learning portal throughout the test preparation procedure to boost their confidence.
Loan Balance Formula
The Loan Balance formula is B=A(1+r)n−pr[(1+r)n−1]
Where,
B = Balance Amount
A = Loan Amount
P = Payment Amount
r = Rate of Interest (compounded)
n = Number of periods
Loan Balance
A loan is an amount of money borrowed from an individual, a bank, or another financial institution in exchange for future repayment of the capital plus interest. The main is the amount borrowed, while the interest is the cost they paid to get the loan. Since creditors assume the risk that they may fail on the loan, they must compensate by charging a fee known as interest. The most prevalent forms of loans are secured and unsecured loans. A secured loan is one in which the borrower commits an asset as security (such as a vehicle, boat, or house).
Sample Problems
Extramarks provides sample problems based on the Loan Balance formula which are extremely dependable and accurate study tools for students. Students can boost their test preparations by acquiring study tools from the Extramarks website and mobile application. Extramarks’ study material is constantly evaluated for errors and updated following the curriculum.
The Extramarks mobile application contains all of the tools required for competitive test preparation. Extramarks may help students prepare for a range of competitive exams, such as JEE Mains, NEET, JEE Advance, CUET, and others. The Extramarks website and Learning App provide all of the resources needed to perform well on competitive examinations.
Students may view live lectures on any subject on the Extramarks website and mobile application. These live courses are regularly updated and have a high degree of participation. Students may readily obtain solutions to their questions during the doubt-solving classes.
By incorporating the Loan Balance Formula and solved questions into their academic schedule, students can attain proficiency with regard to this topic. It will either provide conceptual information or reinforce the fundamental component. Students can have a better understanding of the Loan Balance Formula material by completing the three objectives and extra exercises. Students may learn about the Loan Balance Formula by visiting the Extramarks website or downloading the Extramarks mobile application.
FAQs (Frequently Asked Questions)
1. What are the benefits of utilising the Loan Balance Formula?
Students may use the Loan Balance Formula to practise and revise their assignments. It saves time in referring by presenting all relevant concepts and equations in the correct order. The Loan Balance Formula urges students to use a logical approach. The Loan Balance Formula is quite helpful while studying or solving questions.
2. What is Loan Balance?
Banks and creditors sometimes provide simple repayment alternatives such as monthly instalments, in which debtors compensate the lender with similar amounts each month until the loan is paid off. The loan balance is the amount of a debt that still has to be paid. It is computed by subtracting the sum of all previous principal payments from the total loan amount.
