Work out loan amortisation factor instantly with clear inputs, formula shown and shareable results.
The amortisation factor, also written (A/P, r, n), is the payment per unit of loan that exactly clears principal and interest over the term. Multiply it by any loan size to get the level instalment.
Amortisation factor
A/P = r(1+r)^n / ((1+r)^n - 1)
Because the factor is independent of loan size, so one number prices every loan at that rate and term.
The factor becomes 1/n, meaning the loan is simply repaid in equal slices of principal.