How to Calculate the Principal Remaining on a Mortgage
- 1). Divide the annual interest rate by 12 to find the monthly interest rate. For example, if your mortgage's annual interest rate equals 6.96 percent, you would divide 0.0696 by 12 to get 0.0058.
- 2). Add 1 to the monthly interest rate. In the example, add 1 to 0.0058 to get 1.0058.
- 3). Raise the Step 2 result to the number of monthly payments that you have already made. In this example, if you had made 15 monthly payments, you would raise 1.0058 to the 15th power to get 1.09062254.
- 4). Divide your monthly payment by the monthly interest rate. Here, if your monthly payment equals $1,159.58, you would divide $1,159.58 by 0.0058 to get 199,927.58620690.
- 5). Subtract 1 from the Step 3 answer and multiply the result by the Step 4 answer. Here, you would subtract 1 from 1.09062254 to get 0.09062254, then multiply 0.09062254 by 199,927.58620690 to get 18,117.94579091.
- 6). Multiply the amount borrowed by the Step 2 result. Here, if you borrowed $175,000, you would multiply $175,000 by 1.09062254 to get 190,858.94459871.
- 7). Subtract the Step 5 result from the Step 6 result to find the remaining balance on your mortgage. Completing the example, you would subtract 18,117.94579091 from 190,858.94459871 to find you owe $172,741.00 on the mortgage.
