Comm Bank Personal Loan Calculator

Personal Loan Payment Formula:

\[ PMT = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]

Monthly Payment (PMT):

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1. What is the Personal Loan Payment Formula?

The personal loan payment formula calculates the fixed monthly payment required to repay a loan over a specified term. This calculation is used by Commonwealth Bank and other financial institutions to determine loan repayments.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

\[ PMT = P \times \frac{r \times (1 + r)^n}{(1 + r)^n - 1} \]

Where:

$ P $ — Principal loan amount (AUD)
$ r $ — Monthly interest rate (annual rate ÷ 12)
$ n $ — Total number of payments (loan term in years × 12)
$ PMT $ — Monthly payment amount (AUD)

Explanation: The formula accounts for compound interest and spreads payments evenly over the loan term.

3. Importance of Loan Payment Calculation

Details: Understanding your monthly payment helps with budgeting and comparing different loan options. It shows the true cost of borrowing.

4. Using the Calculator

Tips: Enter the loan amount in AUD, annual interest rate (without % sign), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What interest rates does Commonwealth Bank offer?
A: Rates vary based on credit score, loan amount, and term. Check CommBank's website for current rates.

Q2: Are there additional fees?
A: CommBank may charge establishment fees (typically $150-$250) and monthly service fees.

Q3: Can I make extra repayments?
A: CommBank personal loans typically allow extra repayments without penalty.

Q4: How does loan term affect payments?
A: Longer terms reduce monthly payments but increase total interest paid.

Q5: Is this calculator accurate for all CommBank loans?
A: This provides an estimate. Actual payments may vary based on specific loan features and fees.