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, including interest. It's used by HSBC and other banks in Singapore for personal loan calculations.

2. How Does the Calculator Work?

The calculator uses the personal loan payment formula:

Where:

• \( P \) — Principal loan amount (SGD)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Number of monthly payments (loan term in months)
• \( PMT \) — Monthly payment amount (SGD)

Explanation: The formula accounts for compound interest over the loan term, calculating a fixed payment that covers both principal and interest each month.

3. Importance of Loan Calculation

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

4. Using the Calculator

Tips: Enter the loan amount in SGD, annual interest rate (HSBC's current rates), and loan term in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What are typical HSBC personal loan rates in Singapore?
A: Rates vary (3.5%-8% p.a.) based on credit score, loan amount, and term. Check HSBC's latest offers for current rates.

Q2: Are there any fees not included in this calculation?
A: HSBC may charge processing fees (1%-3%) or early repayment fees. These aren't included in the monthly payment calculation.

Q3: What's the maximum loan term available?
A: HSBC Singapore typically offers personal loans with terms from 1 to 7 years (12 to 84 months).

Q4: Can I prepay my HSBC personal loan?
A: Yes, but early repayment fees may apply. Check HSBC's terms for details.

Q5: How does this compare to other banks in Singapore?
A: Most Singapore banks use similar formulas, but rates and terms vary. Compare total repayment amounts across banks.