# QMac 2017: Apparently No Option for Variable Interest Rates under new Quicken Mac Version 4.5.0 (Bui

FON
Member

I have upgraded to new Quicken Mac Version 4.5.0 (Build 45.17283.100). I am trying to convert my variable rate mortgage using the new Loan feature. The dialog box for entering Loan and Payment details only seems to support fixed rate loans. The line for interest rate has a blank for the percentage, but the drop down menu to the right is greyed out and only allows for "Fixed."

Major flaw if we can allow for this most common kind of mortgage.

Major flaw if we can allow for this most common kind of mortgage.

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## Comments

In the case of the Windows version the only way they added loans that aren't fixed is by having them set to download from the financial institution, and then making what is downloaded control the whole process (user has no access to a register).

Here is what the setup looks like in the Windows version:

Markets change all the time and there was a time where variable rate loans were far more common. Regardless, they are still in use, so they should implemented it eventually.

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(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileHopefully, variable rates will be implemented soon after. Many users still need them, and having a PFM software that lacks this is like having a calculator that only does addition, subtraction, and multiplication but not division, or whatever.

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(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileFor instance in a simple case it might be something like, for 7 years you get rate X, but then it switches to rate Y.

But it can also be you have a fixed rate X for 7 years, and then it changes to 1 percent above CPI. Since CPI is never known until it is locked in the for the year you basically can't predict the full payment schedule of the loan.

Also in people have complained on here because Quicken's loan calculator didn't capture their car loan correctly. Everything from a "constant interest rate", to things like having the day you pay affect the interest, to some really bizarre "periods".

QM2007 has a simple ability to track variable rates such that when payment is made, a user has to opportunity to enter the new and current rate.

So I have always done adjustments at the end of the year to match the bank's records before doing any tax reports, etc (the only place it really matters; in my mind, all others are for personal benefit anyways).

So, I say, keep it simple from a user interface perspective, and just provide the ability to override as needed, creating multiple loan segments if needed, etc. Otherwise, you may get into an over-engineering of the product.

That is why I said, the algorithms exist (in QM2007) to handle this already.

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(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileIt sounds like Quicken Mac 2007 had the same as what the Windows version has (which makes perfect sense), that you change the rate at any time. Given that you aren't even really calculating "variable".

If I use a 30-year fixed at that percentage, Quicken gets close, but I see that I would have to add $0.35 to the principal every month, so--as I sad--might as well keep tracking manually.

In QM2007, when you set up the loan, you can specify whether it is fixed or variable rate. Which you choose determines if the option to adjust the rate shows up each time you make a payment. Is this what exists in QWin? If so, I think that would be sufficient in QM2017 too...

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(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileClicking on the interest rate "Edit"

Expanding the Adjustable- rate section and clicking on Add new rate button.

With the exception of a "constant interest rate" there is in fact no "variable" calculation. There can't be you don't know what your future rates will be.

The way interest and principal is calculated is just current principal * interest rate for that period.

If I have a 5% loan compounded monthly and I have 10,000 left on the loan the next month's interest is: 10,000 (.05 /12) = 41.67.

Notice that how long I have left to pay it off has no bearing on the calculation.

But what I will need to make an exact prediction is every single rate change until the loan is paid off.

This information is "unknowable".

So In fact what the financial institution it doing is making some kind of prediction how the future adjusting rates are going to affect the overall loan, and they factor that into what you are paying even before your rate becomes "variable".

So in fact the reason that your calculation for the month isn't right is because the interest rate isn't right (or they have a hidden fee to compensate). It has been adjusted to take into account the future.

So my big question would be do all financial institutions make the same adjustment?

I would bet the answer is no.

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(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileBut in fact as you can read about FON's problem below, it is in fact not the ability to change the interest rate that he/she is concerned with. It is the fact that he/she is actually not paying the the interest rate stated or is paying some kind of extra hidden fee to compensate for the fact that the loan is going to vary in the future.

(If you find this reply helpful, please be sure to click "Like", so others will know, thanks.)

If you find this reply helpful, please be sure to click "Like", so others will know, thanks.

(Canadianuser since '92,STILL usingQM2007)Have Questions? Check out these FAQs:Where to find a Help Guide for Quicken for Mac?Quicken Mac FAQ listQuicken Windows FAQ listHelp Guide and FAQs for Quicken MobileWith the exception of a "constant interest rate" there is in fact no "variable" calculation. There can't be you don't know what your future rates will be.

The way interest and principal is calculated is just current principal * interest rate for that period.

If I have a 5% loan compounded monthly and I have 10,000 left on the loan the next month's interest is: 10,000 (.05 /12) = 41.67.

Notice that how long I have left to pay it off has no bearing on the calculation.

But what I will need to make an exact prediction is every single rate change until the loan is paid off.

This information is "unknowable".

So In fact what the financial institution it doing is making some kind of prediction how the future adjusting rates are going to affect the overall loan, and they factor that into what you are paying even before your rate becomes "variable".

So in fact the reason that your calculation for the month isn't right is because the interest rate isn't right (or they have a hidden fee to compensate). It has been adjusted to take into account the future.

So my big question would be do all financial institutions make the same adjustment?

I would bet the answer is no.That's not exactly what they're doing. With a variable rate loan, the payment is calculated based on the remaining period of the loan at the current rate. So the length of time remaining on the loan does, in fact, have a bearing on the calculation.

In other words, a variable rate loan is amortized exactly the same as a fixed rate mortgage. It's just that at each rate adjustment, the loan is re-amortized using the new rate, the remaining principal, and the remaining time.