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. It's commonly used by banks like Metrobank Philippines for personal loan amortization.

2. How Does the Calculator Work?

The calculator uses the loan payment formula:

Where:

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

Explanation: The formula accounts for both principal repayment and interest charges, distributing payments equally over the loan term.

3. Importance of Loan Payment Calculation

Details: Understanding your monthly payment helps with budgeting and ensures the loan is affordable. It also shows the total cost of borrowing.

4. Using the Calculator

Tips: Enter the loan amount in PHP, annual interest rate (Metrobank's current rates), and loan term in months (typically 12-60 months for personal loans).

5. Frequently Asked Questions (FAQ)

Q1: What are typical Metrobank personal loan rates?
A: Rates vary but typically range from 10% to 24% annually depending on creditworthiness and loan terms.

Q2: Are there other fees besides interest?
A: Metrobank may charge processing fees (1-3% of loan amount) and documentary stamps tax (0.75% of loan amount).

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 off my loan early?
A: Yes, but check for prepayment penalties. Some banks charge 1-5% of outstanding balance for early repayment.

Q5: What's the maximum loan amount?
A: Metrobank typically offers up to PHP 2 million for personal loans, depending on income and credit history.