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**AMORTIZE**(//balance,rate,payment,totalpayments,principal,interest,endbalance//)

| **AMORTIZE** | Calculates principal, interest, and remaining balance for a payment or payments. |
| //balance// | A numeric constant or variable containing the loan balance. |
| //rate// | A numeric constant or variable containing the //periodic interest rate// applied for a single period. |
| //payment// | A numeric constant or variable containing the desired payment (a negative number). |
| //totalpayments// | A numeric constant or variable containing the number of payments to amortize. |
| //principal// | The label of a DECIMAL variable to receive the portion of the payment(s) applied to pay back the loan (a negative number). |
| //interest// | The label of a DECIMAL variable to receive the portion of the payment(s) applied towards loan interest (a negative number). |
| //endbalance// | The label of a DECIMAL variable to receive the remaining loan balance. |

The **AMORTIZE **procedure shows precisely which portion of a loan payment, or payments, constitutes interest and which portion constitutes repayment of the principal amount borrowed. The computed amounts are based upon a loan balance (//balance//), a periodic interest rate (//rate//), the payment amount (//payment//) and the number of payments (//totalpayments//). The remaining balance (//endbalance//) is also calculated.

Periodic rate may be calculated as follows:

**PeriodicRate = AnnualInterestRate / (PeriodsPerYear * 100)**

{{c6h0012.jpg|C6H0012.jpg}}

The return parameters principal, interest, and endbalance must be DECIMAL values (passed by value).

**Internal Formulas:**

{{amortize.jpg|AMORTIZE.jpg}}

**Example:**

**Principal     DECIMAL(18,2)**

**Interest      DECIMAL(18,2)**

**EndingBalance DECIMAL(18,2)**

**CODE**

**BeginningBalance = LoanAmount             !Set first beginning balance**

**Period# = 1                               !Begin with the first period**

**LOOP Ptr# = Period# TO TotalPeriods       !Loop through the periods**

** AMORTIZE(BeginningBalance,MonthlyRate,Payment,1, |**

** Principal,InterestAmount,EndingBalance)  !Amortize 1 payment**

** Q:Balance = BeginningBalance             !Show the beginning balance**

** Q:Payment = Payment * (-1)               !..the payment amount**

** Q:Principal = Principal * (-1)           !..amount applied to principal**

** Q:Interest = InterestAmount * (-1)       !..amount applied to interest**

** Q:NewBalance = EndingBalance             !...ending balance**

** IF Ptr# = TotalPeriods|                  !If last period**

**  AND EndingBalance <; 0                   !and balance went negative**

**  Q:Principal += EndingBalance            !adjust principal downard**

**  Q:Payment += EndingBalance              !and also the payment**

**  Q:NewBalance = 0.0                      !and make the balance zero.**

** END**

** EndingBalance = Q:NewBalance             !Save the ending balance**

** ADD(AmortizeQue)                         !Add all period values to Q**

** BeginningBalance = EndingBalance         !Make a new beginning balance**

** TotalInterest += Q:Interest              !Add up total interest**

**END                                       !End loop**