Loan ion Schedule for a Housing Loan

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<ul><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 1/14</p><p>Presented by</p><p>S . Swarupa Rani</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 2/14</p><p>` Loan amortization is the distribution of a singlelump-sum cash flow into many smaller cash flowinstallments, which is determined by an</p><p>amortization schedule.` As far as banking and finance are considered, an</p><p>amortizing loan is one in which the principal of theloan is paid down over the life of the loan</p><p>` According to an amortization schedule, typicallythrough equal payments.</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 3/14</p><p>` An amortization schedule is a table detailing eachperiodic payment on an amortizing loan (typically amortgage), which is generated by an amortizationcalculator.</p><p>` Amortization schedules run in chronological order.` The first payment is assumed to take place one full</p><p>payment period after the loan was taken out.</p><p>` The last payment completely pays off the remainder ofthe loan.</p><p>` Often, the last payment will be a slightly differentamount than all earlier payments.</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 4/14</p><p>` In addition to banking, the bank, through itssubsidiaries, provides a range of financial services,which include life insurance, merchant banking,mutual funds, credit card, factoring, security trading,</p><p>pension fund management and primary dealership inthe money market.</p><p>It operates in four business segments:</p><p>` Treasury</p><p>` Corporate/Wholesale Banking</p><p>` Retail Banking and</p><p>` Other Banking Business.</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 5/14</p><p>Location:State Bank ofIndia</p><p>zonal office</p><p>Nakala road</p><p>vijayawada.Persons interviewed:</p><p>Mr.Nageswara Rao, loan section and</p><p>Mr.Narayana Murty, clerk</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 6/14</p><p>Loan Amortization Inputs:</p><p>A loan amortization schedule usually takes thefollowing inputs.</p><p>` Beginning Date The date where the loan is taken.</p><p>Payments are assumed to start 1` payment period after the Beginning Date.</p><p>` Loan Amount The amount that the lender will loan tothe borrower.</p><p>` Annual Interest rate The interest rate per year.` Payment Period The total number of payment</p><p>periods. This depends on the Payment</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 7/14</p><p>` Frequency field below. If Payment Frequency selected isAnnually and Payment period is 10, it means 10 years. IfPayment Frequency is Monthly and Payment Period is 12,it</p><p>means 12 months.` Payments Frequency This specifies the frequency the</p><p>loan repayments take place.o Annuallyo Semi-Annuallyo Quarterly</p><p>o Bi-Monthlyo Monthlyo Weekly</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 8/14</p><p>` Depending on this interest rate, the loan amountand the tenure of the loan.</p><p>` Loan amortisation of any loans are not issued inbranches of any bank.</p><p>` Loans are separetely handled and it has separatesection main branches of bank.</p><p>` There are lot of types in loan amortisation</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 9/14</p><p>` Loan is a sum of money borrowed from a lender,which is to be repaid after a specified period oftime with interest charges.</p><p>` There are lots of loans given in a bank` Loan amortization for housing loans details each</p><p>periodic payment on amortizing loan(typicallymortgage)</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 10/14</p><p>For example, here are the first few lines of an amortizationschedule for a 15-year, 10% fixed rate loan with an initialprincipal of $187,000</p><p>Balance Scheduled Balance Before Principal After </p><p>Payment Due date Payment Payment Interest Repayment Payment </p><p>1 1/15/93 $187,000.00 $2,009.51 $1,558.33 $451.18 $186,548.822 2/15/93 $186,548.82 $2,009.51 $1,554.57 $454.94 $186,093.88</p><p>3 3/15/93 $186,093.88 $2,009.51 $1,550.78 $458.73 $185,635.154 4/15/93 $185,635.15 $2,009.51 $1,546.96 $462.55 $185,172.605 5/15/93 $185,172.60 $2,009.51 $1,543.11 $466.41 $184,706.206 6/15/93 $184,706.20 $2,009.51 $1,539.22 $470.29 $184,235.907 7/15/93 $184,235.90 $2,009.51 $1,535.30 $474.21 $183,761.698 8/15/93 $183,761.69 $2,009.51 $1,531.35 $478.16 $183,283.53</p><p>9 9/15/93 $183,283.53 $2,009.51 $1,527.36 $482.15 $182,801.38</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 11/14</p><p>Amortisation schedule is based on followingassumptions</p><p>` It should be known that rounding errors.</p><p>` Repetitive mortgage will decrease the principalbalance</p><p>` The payment on an amortized loan remains samefor entire loan term.</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 12/14</p><p>Time value of money:</p><p>time value of money is different indifferent time period.</p><p>the value of some of money received infuture is less valuable than today.</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 13/14</p><p>So these the above constraints that arerequired to prepare a loan amortization schedule</p><p>for a housing loan in State Bank ofIndia(SBI)</p></li><li><p>8/6/2019 Loan ion Schedule for a Housing Loan</p><p> 14/14</p><p>Thank you</p></li></ul>