Calculates the monthly payment for a loan of a given amount and with a given interest rate. - Java java.lang

Java examples for java.lang:Math Calculation

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Description

Calculates the monthly payment for a loan of a given amount and with a given interest rate.

Demo Code


//package com.java2s;

public class Main {
    /** Calculates the monthly payment for a loan of a given amount and
     *  with a given interest rate. Formula taken from
     *  http://www.financeformulas.net/Loan_Payment_Formula.html   and
     *  http://en.wikipedia.org/wiki/Mortgage_calculator#Monthly_payment_formula
     *  //from  w  ww.j  a  v a2s . c  o  m
     * @param loanAmount the loan amount (principal) in same units as the return value. For example,
     *                   if you supply dollars for the loan amount, then the returned monthly payment
     *                   will also be in dollars.
     * @param annualInterestRateInPercent the yearly interest rate as a percent, not as decimal.
     *                                    For example, 12.5 would mean a 12.5% annual interest rate.
     * @param loanPeriodInMonths the number of months over which the loan will be repaid. 
     * @return the payment per month, in the same units as the loan amount.
     */
    public static double monthlyPayment(double loanAmount,
            double annualInterestRateInPercent, long loanPeriodInMonths) {
        if (annualInterestRateInPercent <= 0) {
            annualInterestRateInPercent = 0.0000001;
        }
        double monthlyInterestRate = annualInterestRateInPercent / 1200.0;
        double numerator = loanAmount * monthlyInterestRate;
        double denominator = 1 - Math.pow(1 + monthlyInterestRate, -1
                * loanPeriodInMonths);
        return (numerator / denominator);
    }
}

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