How interest is applied to loans 19 May 2019 at 8:59PM in Student MoneySaving

nmaniv

Hey everyone,


I need help understanding how interest is applied to my loan over time.
Here are some example stats



Monthly Mandatory repayments (taken from my pay): £130

Interest rate: 6.3%
loan: £66,000


Would my loan grow every month based on this equation ?




new balance = balance + (balance * 0.063)/12 - 130


> does this happen every month for 30 years?

> is the interest applied before or after the mandatory repayment is deducted?


Thanks!



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P.S. I'm trying to make a computer program that simulates loan repayments and want to make sure I am using the correct formulas