In Excel: use =PMT(rate/12, years*12, -amount) to get the level monthly repayment.
On this page7
Put the loan amount, the annual interest rate and the term in years into their own cells.
In a blank cell type =PMT(rate/12, years*12, -amount), clicking each input cell.
Press Enter — the monthly payment appears as a positive figure thanks to the minus on the amount.
Multiply the payment by the number of months to see total paid, then subtract the principal for total interest.
What this does
PMT returns the fixed monthly payment that fully repays a loan — principal plus interest — over its term. It assumes a constant rate and equal payments, which is how the overwhelming majority of mortgages, car loans and personal loans are structured. Dividing the annual rate by 12 and multiplying the years by 12 puts everything on a monthly footing; the negative sign on the amount makes the payment show as a positive number. Keep the inputs visible and clearly labelled and the whole thing stays auditable — anyone who opens the file later, including you, can see at a glance exactly what feeds the result and change one assumption without hunting through the formula. The difference between a quick fix and a sheet you can trust is the extra minute you spend validating “loan format in excel”. Start on a copy or a tiny sample, keep the affected cells visible, and compare the result with the outcome you expected before you touch the real workbook. When a formula is involved, keep the inputs labelled beside it, reference cells instead of typing values, and apply number formatting only after the result checks out. The point is a calculation you can defend to a CFO or an auditor, but the practical win is that someone else can open the file and understand what happened without asking you.
A worked example
A €250,000 mortgage at 3.8% over 25 years: =PMT(3.8%/12, 25*12, -250000) returns about €1,292 a month. Over the full term you repay roughly €387,500, so interest alone is about €137,500 — the area the balance curve above shrinks as you shorten the term or drop the rate. Whether you are comparing mortgage offers, sizing a car loan, or stress-testing a budget against a rate rise, PMT is the one formula that turns a headline rate into the number that actually hits your account each month. Check the referenced cells, argument order and result type in your workbook. Start with the worked example before changing an input, then compare the changed result with the calculation you expected. An error value or a result of a different type is a reason to inspect the inputs and arguments.
In Google Sheets
Google Sheets support for this task has not been verified. Check the function, arguments and workflow in the target product before transferring the example. Matching formula notation does not establish identical behaviour. The aim was to get you unstuck fast and leave you a little more capable than a copy-paste would. The answer is at the top and the detail above shows why it holds — so the next time a colleague asks, you can answer without reaching for search. For “loan format in excel”, keep the input cells and the result visible while you check the formula in Excel. Follow the worked example and change one input at a time. The steps explain the workbook calculation; this page does not run a live calculator for that task.
Common mistakes
- Forgetting to divide the annual rate by 12, which inflates the payment roughly twelve-fold.
- Entering the loan amount as positive, so
PMTreturns a negative payment. - Mixing the term and rate periods (annual rate with a monthly term, or vice versa).
- Ignoring fees, insurance or an offset, which the bare
PMTfigure does not include.
Frequently asked questions
Why is the amount negative in PMT?
PMT follows a cash-flow convention: money you receive is positive, money you pay is negative. Entering -amount simply flips the returned payment to a positive number.
How do I see the interest portion?
Total interest is the sum of all payments minus the principal. For a month-by-month split, use the amortization calculator, which breaks each payment into interest and principal.
Does this match my bank’s figure?
The core repayment will match closely; small differences come from fees, rounding, or daily vs monthly interest accrual your lender may use.