What would you like to do?

Calculate average loan life of a term loan?

already exists.

Would you like to merge this question into it?

already exists as an alternate of this question.

Would you like to make it the primary and merge this question into it?

exists and is an alternate of .

It will be different from final maturity, in case this is an amortising loan.
In essence, you should be looking at this particular term loan as a series of shorter term loans with different final maturities.

So to calculate the average life, you should calculate the average of these multiple maturities weighted by the debt sums (aka debt amortisation sums).

- - - - -

Say if you have borrowed £100 with semi-annual amortisation over a period of 10 years, £5 is due in 6 months, another £5 in 1 year... another £5 in 9.5 years and the final £5 in 10 years.

In Excel use SUMPRODUCT function to multiply an array of maturities (0.5,1,...,9.5,10.0) by an array of debt sums (£5,£5,...,£5,£5). You'll then divide the result over the total amount (£100). The result should be 5.25 years.

This is a reflection of the fact that your liability decreases over time.
+ 10 others found this useful
Thanks for the feedback!

How do you calculate the percent in a loan?

% over 100 = is over of. the % divided by 100 is the same as loan over the total. do cross multiplication...% x total = 100 x loan. divide both sides by the coeficient (which

What are the benefits of a home loan calculator?

You are able to find out what monthly payment you will have to make. Simply put in loan amount the loan term in months or years, the interest rate and the start date of the lo

How are home loan rates calculated?

Home loan rates are calculated based on the buyers financial history, fiscal responsibility, and past home buying experiences. Martial status and age may also be factored in.

What can you do when a loan officer misrepresents the terms of a loan?

It may be hard to prove that anyone misrepresented the terms if you signed a contract acknowleging the terms. I realize that contracts can be pages and pages of fine print, bu

How do i calculate loan payments?

Cut & pase this link into your browser: http://rws.rwstools.com/templateroot/Calculators.asp?PVLID=26316 Or you can do it the hard way: payment = Balance*(int/(1-(1/(1+i

What is a loan holiday for term loans?

A loan holiday is some period of time (e.g., one payment period, two payment periods, etc.) where the borrower is not required to make a payment and will not be penalized as a

What is a car loan payment calculation?

The easy-to-use auto loan calculator helps car buyers plan monthly car loan payments. Calculate car financing and car payments in advance to make a smart decision on how much

How do you calculate a 12 month average balance on a loan?

  The answer depends on when interest is calculated, how frequently payments are made, the interest rate being charged and the life time of the loan. There are a number of

What is the best personal loan calculator?

While there are many programs and sites that can calculate loans the best option is probably someone at a bank. I say this because a banker will always be up to date on all fa

How to calculate a loan of 275000 with a 25 years loan term and at a 5.750 percent?

  Answer   Hello, How are you doing? I have an important annoucement for you.. Willscott Loan Agency is currently giving out loans at an interest rate of 0

What is a home loans calculator?

A home loans calculator is an online tool designed by mortgage  lenders to help you calculate your monthly installment. It will  enable you to work out how much you can borr

What is the process of calculating loan emi?

With the help of mathematical formula, you can calculate the loan  EMI, Just you need to follow bellow steps   A calculation process works on three main criteria such as

How do you calculate student loans?

 If you can, pay interest during your grace period or periods of  deferment/forbearance to avoid having interest capitalized (added  to your principal) on unsubsidized loa