Amortization Schedules

This project requires you to create an amortization schedule for two types of loans, a fully amortizing

constant payment mortgage (CPM) loan and a constant amortizing (CAM) loan. In your report, compare

the amortization schedule of the CPM and CAM loans (How are they similar? How are they different?

Which would you prefer and why?)

Part 1: Monthly Payment

Consider a $10,000 loan made at a 12 percent annual (nominal) rate of interest for 3 years.

A) Calculate the constant monthly mortgage payments on this loan, assuming it is to be fully

amortized at the end of 3 years. Be sure to use the excel PMT function to calculate the monthly

payment (see https://support.office.com/en-us/article/PMT-function-0214da64-9a63-4996-

bc20-214433fa6441) (10 Points)

Part 2: CPM Loan

Consider a $10,000 fully amortizing CPM loan made at a 12 percent annual (nominal) rate of interest for

3 years.

B) Fill in the amortization schedule for each month (calculate or fill in the values of beginning loan

balance, monthly payment, interest, amortization, and ending loan balance). Be sure to show

calculations if needed (i.e. do not simply type in values but reference other cells to compute the

calculations) (30 points)

Part 3: CAM Loan

Consider a $10,000 CAM loan made at a 12 percent annual (nominal) rate of interest for 3 years.

C) Fill in the amortization schedule for each month (calculate or fill in the values of beginning loan

balance, monthly payment, interest, amortization, and ending loan balance). Be sure to show

calculations if needed (i.e. do not simply type in values but reference other cells to compute the

calculations) (30 points)

Excel Note: If you want to lock in a cell reference, use the $ symbol. For example, if you would like to keep

the value of cell A5 constant for use in a formula, reference it as $A$5. See https://support.office.com/enus/article/Switch-between-relative-absolute-and-mixed-references-dfec08cd-ae65-4f56-839e5f0d8d0baca9

Part 1: A) Monthly payme

Loan amount =

nominal rate =

number of yrs =

periodic rate =

number of periods=

Monthly payment =

Part 2: B) Amortization scheduled CPM

monthly beginning loan balance	monthly payment	Intrest	Amortization	ending loan balance

Part 3. C ) Amortization schedule CAM

monthly beginning loan balance	Intrest	Amortization	Monthly payment	ending loan balance