April 22nd, 2015, 01:29 AM  #1 
Newbie Joined: Apr 2015 From: london Posts: 2 Thanks: 0  financial math
Hi guys, I have come across this calculation of principal amount reduction of a loan for property and do not understand the logic behind it. I would appreciate it if someone could explain to me the middle three rows where it says "internal mathematical calculations ignore these rows". Many thanks. Last edited by skipjack; April 22nd, 2015 at 02:10 AM. 
April 22nd, 2015, 02:12 AM  #2 
Global Moderator Joined: Dec 2006 Posts: 20,472 Thanks: 2039 
The End of Yr Balance value seems to be calculated by subtracting the third internal value from the first internal value.

April 22nd, 2015, 03:17 AM  #3 
Newbie Joined: Apr 2015 From: london Posts: 2 Thanks: 0 
thanks skipjack, I understand that, but I don't understand why initial loan is increased every year, and why interest rate is changing, and why they calculated interest rate this way. the whole thing is very confusing for me many thanks 

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