How to Manually Amortize a Loan

Forward Amortize a Loan

Step 1: Current UPB x Note Rate = Step 1 Sum
187,500.00 x 3.5 % = 6,562.50

Step 2: Step 1 Sum divided by 12 = Interest
6,562.50 /  12  = 546.87

Step 3: P&I – Step 2 Sum = Principal
841.96 – 546.87 = 295.09

Step 4: Current UPB  – Principal = Issue Date UPB
187,500.00 – 295.09 = 187,204.91

Reverse Amortize a Loan

Step 1: Current UPB + P&I = Sum 1
187,204.91 + 841.96 = 188,046.87

Step 2: Determine the Monthly Interest Rate Factor and add 1
3.50 / 12 = .002916667 + 1 = 1.002916667

Step 3: Sum from Step 1 divided by the Monthly Interest Rate Factor = Issue Date UPB
188,046.87 / 1.002916667 = 187,500.00