CODEWITHSUNDEEP
camortization
user1892641
user1892641

Reputation: 31

C - I am calculating amortization and my results are off

I am trying to calculate the monthly payment of a loan and it always comes out wrong.

The formula is as follows where i is interest

((1 + i)^months /
(1 + i)^months - 1)
* principal * i

Assuming that annual interest rate and principal is an invisible floating point, can you tell me what's wrong with my formula?

double calculatePaymentAmount(int annualInterestRate, 
     int loanSize,                          
     int numberOfPayments;
{
double monthlyInterest = annualInterestRate / 1200.0;
return 
    (
        pow(1 + monthlyInterest, numberOfPayments) /
        (pow(1 + monthlyInterest, numberOfPayments) - 1)
    )
    * (loanSize / 100)
    * monthlyInterest;
}

For example: an interest rate of 1.25 and a loan size of 250 for 12 months gives 22.27 instead of 20.97.

Thank you in advance.

Edit 1: Changed monthly interest to annualInterestRate / 1200

Upvotes: 1

Views: 210

Answers (3)

user1892641
user1892641

Reputation: 31

I found what was wrong. monthlyInterest = annualInterestRate / 1200.0 / 100

Upvotes: 0

Mahmut Ali ÖZKURAN
Mahmut Ali ÖZKURAN

Reputation: 1139

converting

double monthlyInterest = (double)annualInterestRate / 
    1200 / 100;

to 

double monthlyInterest = (double)annualInterestRate / 12.0;

would do the trick.

you may read more about operator precedence in c from http://en.cppreference.com/w/c/language/operator_precedence

Upvotes: 0

Henrik
Henrik

Reputation: 23324

Assuming annualInterestRate is in percent, then you should calculate monthlyInterest like this:

double monthlyInterest = pow(1+(double)annualInterestRate / 100, 1/12.0) - 1.0;

Upvotes: 0

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