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  • FIRST POST
    • Mr Man-Man
    • By Mr Man-Man 9th May 17, 8:24 PM
    • 1Posts
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    Mr Man-Man
    What's the formula to work out minimum repayment
    • #1
    • 9th May 17, 8:24 PM
    What's the formula to work out minimum repayment 9th May 17 at 8:24 PM
    I have an amount of credit card debt I wish to transfer to a 0% card (approx. £10k).

    Can anyone please help with a formula to work out the minimum payment per month

    I am assuming the following detail would be needed

    • Loan amount (balance to be transferred)
    • Length of 0% term (may not be required)
    • Interest rate following the end of the 0% term (is this the APR ??)
    • do any other parameters need to be considered



    I need a formula to work how much I would save every month and therefore to determine the extra I can pay off, versus the amount I could free up per month


    Thanks for any replies
    Mr Man-Man
Page 1
    • zx81
    • By zx81 9th May 17, 8:37 PM
    • 12,035 Posts
    • 12,175 Thanks
    zx81
    • #2
    • 9th May 17, 8:37 PM
    • #2
    • 9th May 17, 8:37 PM
    The minimum payment will be detailed on the terms of the card in question.

    A standard min payment is 1% of balance plus fees and interest, but some are more.
    • MallyGirl
    • By MallyGirl 10th May 17, 10:11 AM
    • 2,037 Posts
    • 5,853 Thanks
    MallyGirl
    • #3
    • 10th May 17, 10:11 AM
    • #3
    • 10th May 17, 10:11 AM
    yes, some are 2% which makes a big difference to your calculations - I remember the Post Office was 2% and maybe the AA.
    • YorkshireBoy
    • By YorkshireBoy 10th May 17, 11:22 AM
    • 29,146 Posts
    • 16,949 Thanks
    YorkshireBoy
    • #4
    • 10th May 17, 11:22 AM
    • #4
    • 10th May 17, 11:22 AM
    yes, some are 2% which makes a big difference to your calculations - I remember the Post Office was 2% and maybe the AA.
    Originally posted by MallyGirl
    2.5% these days on those two BOI products. Certainly makes a dent in the stood pot!
    • Superscrooge
    • By Superscrooge 10th May 17, 11:50 AM
    • 829 Posts
    • 578 Thanks
    Superscrooge
    • #5
    • 10th May 17, 11:50 AM
    • #5
    • 10th May 17, 11:50 AM
    I think what the OP is asking is for a formula giving the payment he would need to make each month to clear the debt by the end of the 0% period?

    eg. With a 10 months 0% BT card and a 10K debt. he would need to repay £1,000 a month to clear the debt in 10 months.

    To pay off the total debt during the 0% promotional period, just divide the debt by the number of months at 0% to get the monthly payment you need to make.
    • edinburgher
    • By edinburgher 10th May 17, 12:20 PM
    • 10,618 Posts
    • 55,112 Thanks
    edinburgher
    • #6
    • 10th May 17, 12:20 PM
    • #6
    • 10th May 17, 12:20 PM
    That was what I thought as well. The actual figure will be ever so slightly lower due to interest earned over the period, but the basic approach is straightforward and I'm no doubt overthinking it
    • logie48
    • By logie48 10th May 17, 1:06 PM
    • 59 Posts
    • 9 Thanks
    logie48
    • #7
    • 10th May 17, 1:06 PM
    • #7
    • 10th May 17, 1:06 PM
    The formula I use in excel is below, to work out the minimum monthly payment:

    This is for 1% or £25, which ever is largest, and generally assumes no further spend, i.e. the balance just runs down at each min monthly payment.

    =if(rounddown(((c4/100)*1),2)<25,25,rounddown(((c4/100)*1),2))

    Where 'C4' is the previous months balance, '*1' is the % min payment and '25' is the smallest min payment.

    Breakdown:

    if
    (rounddown(( [rounded down value, some companies may have this differently, but it will make pennies of a difference regardless]
    (c4/100)*1) [works out 1% of the balance]
    ,2) [gives the 1% value in 2 decimal places]
    <25 [checks if this value less than 25]

    ,25, [if less than 25, then 25 is the true value, and is the minimum payment]
    rounddown(((c4/100)*1),2)) [if more than 25, then this is the false value, and displays this value]


    Hopefully this is not too confusing, and useful if you use excel.
    Last edited by logie48; 10-05-2017 at 1:11 PM.
    • zx81
    • By zx81 10th May 17, 1:09 PM
    • 12,035 Posts
    • 12,175 Thanks
    zx81
    • #8
    • 10th May 17, 1:09 PM
    • #8
    • 10th May 17, 1:09 PM
    ...and remember you have to throw a six to start and the youngest player goes first...
    • msallen
    • By msallen 11th May 17, 7:48 AM
    • 473 Posts
    • 404 Thanks
    msallen
    • #9
    • 11th May 17, 7:48 AM
    • #9
    • 11th May 17, 7:48 AM
    The formula I use in excel is below, to work out the minimum monthly payment:

    This is for 1% or £25, which ever is largest, and generally assumes no further spend, i.e. the balance just runs down at each min monthly payment.

    =if(rounddown(((c4/100)*1),2)<25,25,rounddown(((c4/100)*1),2))

    Where 'C4' is the previous months balance, '*1' is the % min payment and '25' is the smallest min payment.

    Breakdown:

    if
    (rounddown(( [rounded down value, some companies may have this differently, but it will make pennies of a difference regardless]
    (c4/100)*1) [works out 1% of the balance]
    ,2) [gives the 1% value in 2 decimal places]
    <25 [checks if this value less than 25]

    ,25, [if less than 25, then 25 is the true value, and is the minimum payment]
    rounddown(((c4/100)*1),2)) [if more than 25, then this is the false value, and displays this value]


    Hopefully this is not too confusing, and useful if you use excel.
    Originally posted by logie48
    Wow !
    I just use MAX(25,C4*0.01)
    • edinburgher
    • By edinburgher 11th May 17, 8:39 AM
    • 10,618 Posts
    • 55,112 Thanks
    edinburgher
    I would have used FV and worked backwards (allows for you to show the effect of minimal interest reducing the amount needed).
    • logie48
    • By logie48 11th May 17, 12:41 PM
    • 59 Posts
    • 9 Thanks
    logie48
    Wow !
    I just use MAX(25,C4*0.01)
    Originally posted by msallen


    That just highlights my limited knowledge of excel !!
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