Loan Setup - Weird Principal Number

mrblasty

• Using Quicken Deluxe - Personal
• Trying to add a Dental Loan (See image)
• There is no interest for this loan
  • Principal: $3,500
  • 2 Payments made prior to setup
    • Down Payment: $140
    • 2nd Payment: $144.19
    • Remaining: $3,220
  • Monthly payment $140
  • Monthly Payment fee $4.19
• On the right side "Loan Payment" panel it says "Principal: $145.83"
  • Where did this number come from?
  • If I manually add "Loan Fee" of $4.19 with + button and change "Total" to $144.19, it automatically adds -$5.83 to the "Extra Principal" box.
  • What am I missing?

Thanks for your help!

Ken

jacobs

I think the mistake is in your math about the loan payments. The loan payments are for $140 each, and you said it's a two year loan. But $140 x 24 months = $3,360, not the $3,500 loan amount. In fact, this loan was apparently a total of 25 payments: $140 x 25 = $3,500. So if you correct the loan setup to be 25 months instead of 2 years, it correctly shows the $140 monthly principal payment:

In this screen shot, I added the monthly fee of $4.19 using a category I have called Bank Charges, but you could use any existing category or create one; I don't think the choice of category is important, because it's not a tax-deductible expense.

Jon

3500 / 24 = 145.83. You should exclude the down payment from the original loan balance and set it to 3360 instead, that will give you 24 payments of 140.

QuickUserPSP

@mrblasty - The down payment of 140.00 should not be included in the loan amortization. This means that you really only made one payment of 144.19 so far. The total amount financed should be 3360.00.

jacobs

I think the mistake is in your math about the loan payments. The loan payments are for $140 each, and you said it's a two year loan. But $140 x 24 months = $3,360, not the $3,500 loan amount. In fact, this loan was apparently a total of 25 payments: $140 x 25 = $3,500. So if you correct the loan setup to be 25 months instead of 2 years, it correctly shows the $140 monthly principal payment:

In this screen shot, I added the monthly fee of $4.19 using a category I have called Bank Charges, but you could use any existing category or create one; I don't think the choice of category is important, because it's not a tax-deductible expense.

mrblasty

Ahhh, thanks everyone! Surprise, I still suck at math! Seems like the extra month in loan length is best here. I was confused because it gave me the current balance number of 3,220 which does match the two $140 payments already made, but I failed to check the loan length calculation against that. 🙌