On 9/16/2020 12:52 PM, David Carlson wrote:
Unfortunately, it is not flexible enough to
handle modern calculations involving daily interest calculations,
prepayments, and other variations, but it can still be used to set up a
reasonably good estimated split between principal and interest with or
without escrow or insurance, but to keep an accurate running balance it is
usually necessary to manually adjust
It is actually a "tricky" problem if needing to exactly match the bank's
amortization table. And in any case will need at least an annual
adjustment for changes to the escrow component << which if anything, is
even nastier even after the "what it has to cover for the year*" has
been entered (the new RE tax and insurance). There are simply too many
places where you algorithm and what the bank used might make different
assumptions, where rounding takes place, significant digits used, how
the final payment to be, etc.**
Michael D Novack
* The problem is that NOT simply "enough to cover those payments" (over
the year) but to be such that the account NEVER goes below zero or a
specified safety amount at any time during the year. Likely best handled
by a "trial and error" algorithm to determine the least per payment
amount that will accomplish that. It is why the amount appears to jump
around so wildly year to year.
** For that reason, I also used a "trial and error" algorithm for that
which produced more than one potential solution for the amortization
table, one of which guaranteed to match the bank to the penny << in
other words, which had the same payment - escrow component as the bank
did >> In other words, knowing the payment the bank claimed was correct,
produce the amortization table that matched that . The bank would the
table FOR A FEE but hey, I was doing software for a living.
--
There is no possibility of social justice on a dead planet except the equality
of the grave.
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