Hi there,
I am creating myself a spreadsheet template to assist me in working out what an investment would cost me in real terms. I have put in things like house value, deposit, rent, management fees, ,mortgage payments on interest only and also on repayment. I have also put in council rates, land tax, water rates landlord insurance, strata levies, buildings insurance, renovation costs, vacancy factors, letting fees and depreciation schedule costs.
I have created formulas for as much as possible so I can input basic data and get a rough idea of what costs would be. I do not know any formula for working out what payments would be on a mortgage, for interest only or repayment taking into considerations the amount of time the mortgage is spread over too. Can anyone help out here in how I would work that out so far I have just worked out what my app tells me roughly but I would like to get an accurate formula.
Is there anything else I should be taking into consideration on my costs and if anyone has a tool already made up for this that would be great.
Many thanks and good luck in your investments
Paul
Hi Paul
I am not sure if i understand what you are asking but if you are wanting the formula for working out the interest repayments on an interest only loan it is merely
Loan x interest rate (expressed as a percentage / 365 x number of days in a month.
If i am barking up the total wrong tree let us know.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Hi Paul,
Like everything in life, its pretty easy when you know how it works. I am an excel master. You can PM me and send the sheet to me and I will fix it for you. If you want to try and do it yourself, you will need to use the PMT function to calculate the weekly/fortnightly/monthly payment required. There are lots of variables in calculating the answer, but you need to have the rate and number of payments (first and second arguments) in the same units/time periods, so if you are doing monthly payments you need to divide the rate by 12 and multiply the number of years the mortgage is calculated over by 12. Being a financial function, you also need to put the present value (3rd argument) in as a negative (as its what you owe the bank) and financial functions rely on cashflow investments being input correctly, otherwise you get an incorrect answer.
Have a go and see how you fare, but if you struggle, send me the sheet and it will only take me a few minutes to fix it for you.
Dave Ward | Geronimo Finance
http://www.geronimofinance.com.au
Email Me | Phone MeProperty Investor, Property Investment Expert & Advisor, Finance Expert & Strategist
See this thread
Guys that is exactly the sort of thing I am looking for. The formula for the interest only mortgage is simple enough to understand so I'll implement that myself and try and digest the other one too and if I get stuck I will definitely send it your way and as for the link I have not had the chance to look at that yet but I will.
So that is the first issue addressed so secondly how far off was I in my list of probable deductions. Are there any more I should be considering? How about loan set up costs perhaps. I understand that not all costs will be possible to implement into a formula based spreadsheet for a template but it would be nice to have an idea what to expect.
For those who have not talked with me you may gather I am very new to investing, having spent all of my life so far simply working for money, I would like to change that so that money works for me so all your help is greatly appreciated.
Thanks again.
Paul
Freckle wrote:See this thread https://www.propertyinvesting.com/forums/finance/4346478Initial investigation looks as though thats perfect, thanks so much for that.
I conceded and sent the sheet to Dave Ward after all. I will learn in time but for now I just want to know the outcome.
Loan costs are deductible over 5 years or the Term of the loan whichever is shorter.
Cheers
Yours in Finance
Richard Taylor | Australia's leading private lender
Paterson00 wrote:Are there any more I should be considering? How about loan set up costs perhaps. I understand that not all costs will be possible to implement into a formula based spreadsheet for a template but it would be nice to have an idea what to expect.House of wealth have a comprehensive list on their website http://houseofwealth.com.au/resources/checklists/
Cheers
Jamie
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
Email Me | Phone MeMortgage Broker assisting clients Australia wide Email: [email protected]
Dave Ward wrote:Hi Paul,Like everything in life, its pretty easy when you know how it works. I am an excel master. You can PM me and send the sheet to me and I will fix it for you.
Dave is just being modest when he says he is a excel master. The real term is Excel Grand Master, we have excel sheets with single formulas Dave has built that are 6 lines long across my 27" display. One sheet is so complex, it takes our newest PC 14 minutes to calculate!
The main property investment model Dave has worked on over the last couple of years has over 2000 hours development time in it. We now pay a third party consultant to audit and check our modeling, just because the models are so complex and I can't find the time (days and days) to error check.
I am very proud to have Dave as part of the team.
Modernity Investing
Email Me
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