Excel PPMT Function
This post will guide you how to use Excel PPMT function with syntax and examples in Microsoft excel.
Description
The Excel PPMT function returns the payment amount on the principal for a given period for a loan or investment based on constant payments and a constant interest rate. So you can use PPMT function to get the principal amount of a payment for a specified period.
The PPMT function is a buildin function in Microsoft Excel and it is categorized as a Financial Function.
The PPMT function is available in Excel 2016, Excel 2013, Excel 2010, Excel 2007, Excel 2011 for Mac.
Syntax
The syntax of the PPMT function is as below:
=PPMT(rate, per,nper, pv,[fv],[type])
Where the PPMT function arguments are:
 Rate This is a required argument. The interest rate for the loan.
 per This is a required argument. The period for which the payment on the principal is to be calculated. And it must be an integer number between 1 and nper value.
 nPer This is a required argument. The total number of payments for the loan.
 Pv – This is a required argument. The present value of the payments.
 Fv – This is an optional argument. The future value or a cash balance you want to attain after the last payment is made. If fv is omitted, it is assumed to be 0 (zero), that is, the future value of a loan is 0.
 Type – This is an optional argument. The number 0 (zero) or 1 and indicates when payments are due.
Set type equal to  If payments are due 
0 or omitted  At the end of the period 
1  At the beginning of the period 
Note:
 Make sure that you are consistent about the units you use for specifying rate and nper. If you make monthly payments on a fouryear loan at an annual interest rate of 12 percent, use 12%/12 for rate and 4*12 for nper. If you make annual payments on the same loan, use 12 percent for rate and 4 for nper.
Excel PPMT Function Examples
The below examples will show you how to use Excel PPMT Function to calculate the principal payment amount for a loan based on an interest rate and a specified period.
#1 to get the principal payment for month 1 of the loan or investment, using the following formula:
=PPMT(B1/12,1,B2*12,B3)
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