1. What is the Personal Loan Payment Formula?

The personal loan payment formula calculates the fixed monthly payment (PMT) required to repay a loan over a specified term. This formula accounts for the principal amount, interest rate, and loan duration to determine your monthly obligations.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( PMT \) — Monthly payment (ZAR)
• \( P \) — Principal loan amount (ZAR)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Number of monthly payments

Explanation: The formula accounts for compound interest over the life of the loan, spreading payments evenly across the term.

3. Importance of Loan Payment Calculation

Details: Understanding your monthly payment helps with budgeting and ensures the loan is affordable. It also allows comparison between different loan offers.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: Does this include FNB's loan fees?
A: No, this calculates only the principal and interest portion. FNB may charge additional fees not included here.

Q2: What's a typical interest rate at FNB?
A: FNB personal loan rates vary (typically 12-25% p.a.) based on credit profile, amount, and term.

Q3: How does loan term affect payments?
A: Longer terms reduce monthly payments but increase total interest paid. Shorter terms have higher payments but lower total cost.

Q4: Can I pay extra to reduce the term?
A: FNB may allow extra payments which would reduce the loan term and total interest, but check their specific policies.

Q5: Is this calculation accurate for all loan types?
A: This works for standard fixed-rate personal loans. Other products like revolving credit may use different calculations.