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XLeratorDB/financial Documentation

SQL Server CUMIPMT function for odd-first period loans


CUMLIPMT
 
Updated: 31 October 2010

Use CUMLIPMT to calculate the cumulative interest payments for a specified range of periods for a loan or lease. LIPMT calculates the interest payment amount, which will generally be the same as the interest accrual amount, but in some cases involving the US Rule, may be different.
Syntax
SELECT [westclintech].[wct].[CUMLIPMT] (
  <@PV, float,>
 ,<@LoanDate, datetime,>
 ,<@Rate, float,>
 ,<@FirstPayDate, datetime,>
 ,<@NumPmts, int,>
 ,<@Pmtpyr, int,>
 ,<@StartPer, int,>
 ,<@EndPer, int,>
 ,<@DaysInYr, int,>
 ,<@FV, float,>
 ,<@IntRule, nvarchar(4000),>)
Arguments
@PV
the principal amount of the loan or lease. @PV is an expression of type float or of a type that can be implicitly converted to float.
@LoanDate
the date that the loan starts accruing interest. @LoanStartDate is an expression of type datetime or of a type that can be implicitly converted to datetime.
@Rate
the annual interest rate. @Rate is an expression of type float or of a type that can be implicitly converted to float.
@FirstPayDate
the date that the first payment is due. @FirstPayDate is an expression of type datetime or of a type that can be implicitly converted to datetime.
@NumPmts
the total number of payments to be recorded over the life of the loan. @NumPmts is an expression of type int or of a type that can be implicitly converted to int.
@Pmtpyr
the number of loan payments made in a year. @Pmtpyr is an expression of type int or of a type that can be implicitly converted to int.
@StartPer
the period number for which you want to start accumulating the payment information. @StartPer is an expression of type int or of a type that can be implicitly converted to int.
@EndPer
the period number for which you want to stop accumulating the payment information. @EndPer is an expression of type int or of a type that can be implicitly converted to int.
@DaysInYr
the denominator number of days to be used in the calculation of the interest amount in the odd first period. @DaysInYr is an expression of type int or of a type that can be implicitly converted to int.
@FV
the future value at the end of the loan. @FV is an expression of type float or of a type that can be implicitly converted to float.
@IntRule
Identifies the loan as conforming to the US Rule (“U”) or the actuarial rule (“A”) regarding the compounding of interest in the odd first period.
Return Type
float
Remarks
·         If @DaysInYr is NULL, then @DaysInYr = 360
·         If @FV is NULL, then @FV = 0
·         If @IntRule is NULL, then @IntRule = “A”
·         @FirstPayDate must be greater than @LoanDate
·         @Pmtpyr must be 1, 2, 3, 4, 6, 12, 13, 24, 26, 52, or 365
·         @NumPmts must be greater than 1
·         @Rate must be greater than zero
·         @DaysInYr must be 360, 364, or 365
·         @PV must be greater than zero
·         @StartPer must be between 1 and @NumPmts
·         @EndPer must be between @StartPer and @NumPmts
·         If @StartPer = @EndPer then CUMLIPMT = LIPMT
 
Example
Calculate the first year’s cumulative interest for a 50,000, 5-year loan starting on 1 November with payments due on the first of every month. The rate on the loan is 6 per cent.
SELECT wct.CUMLIPMT(
      50000             --Loan Amount
      ,'11/01/2010'     --Loan Start Date
      ,.06              --Annual Interest Rate
      ,'12/01/2010'     --First Payment Date
      ,60               --Number of payments (5*12)
      ,12               --Number of payments per year
      ,1                --Start Period Number
      ,12               --End Period Number
      ,NULL             --Days in year (defaults to 360)
      ,NULL             --FV (defaults to 0)
      ,NULL             --IntRule (Defaults to 'A' for acturial)
      ) as CUMLIPMT
This produces the following result.
CUMLIPMT
----------------------
2759.52255542426
 
(1 row(s) affected)
Calculate the last year’s interest for a 50,000, 5-year loan starting on 1 November with payments due on the first of every month. The rate on the loan is 6 per cent.
SELECT wct.CUMLIPMT(
      50000             --Loan Amount
      ,'11/01/2010'     --Loan Start Date
      ,.06              --Annual Interest Rate
      ,'12/01/2010'     --First Payment Date
      ,60               --Number of payments (5*12)
      ,12               --Number of payments per year
      ,49               --Period Number
      ,60               --Period Number
      ,NULL             --Days in year (defaults to 360)
      ,NULL             --FV (defaults to 0)
      ,NULL             --IntRule (Defaults to 'A' for acturial)
      ) as CUMLIPMT
This produces the following result.
CUMLIPMT
----------------------
368.355536073601
 
(1 row(s) affected)
Calculate the cumulative interest payments for the first two periods on a 150,000 4-year loan at 12 percent interest using the US Rule made on 13 October with no payments due until 4 January and with payments due every 4 weeks after that.
SELECT wct.CUMLIPMT(
       150000           --Loan Amount
      ,'10/13/2010'     --Loan Start Date
      ,.12              --Annual Interest Rate
      ,'01/04/2011'     --First Payment Date
      ,52               --Number of payments (5*12)
      ,13               --Number of payments per year
      ,1                --Period Number
      ,2                --Period Number
      ,365              --Days in year
      ,0                --FV
      ,'U'              --IntRule
      ) as CUMLIPMT
This produces the following result.
CUMLIPMT
----------------------
5477.76606954689
 
(1 row(s) affected)

Let’s look at the same cumulative interest payment, but this time we will specify the actuarial method as the interest rule.
SELECT wct.CUMLIPMT(
       150000           --Loan Amount
      ,'10/13/2010'     --Loan Start Date
      ,.12              --Annual Interest Rate
      ,'01/04/2011'     --First Payment Date
      ,52               --Number of payments (5*12)
      ,13               --Number of payments per year
      ,1                --Period Number
      ,2                --Period Number
      ,365              --Days in year
      ,0                --FV
      ,'A'              --IntRule
      ) as CUMLIPMT
This produces the following result.
CUMLIPMT
----------------------
5481.29955786861
 
(1 row(s) affected)

The difference between the interest payment amount and the payment amount under the actuarial method is added to the principal, resulting a negative principal payment in the first period, increasing the outstanding principal balance.
If you don’t know the period number that you want, you can use the NPNO (Next Payment Number) or PPNO (Previous Payment Number) functions to calculate the period number.
In this example, we calculate the cumulative interest paid in 2010 for a 50,000, 5-year loan which originated on 9/15/2008 at a rate of 5.5% with monthy payments commencing on 10/15/2008.
SELECT wct.CUMLIPMT(
      50000             --Loan Amount
      ,'09/15/2008'     --Loan Start Date
      ,.055             --Annual Interest Rate
      ,'10/15/2008'     --First Payment Date
      ,60               --Number of payments (5*12)
      ,12               --Number of payments per year
      ,wct.NPNO(
             '12/31/2009'     --Settlement Date
            ,'10/15/2008'     --First Payment Date
            ,12               --Payments per Yer
            ,NULL       --Number of Payments
            )           --Start Period Number
      ,wct.PPNO(
             '12/31/2010'     --Settlement Date
            ,'10/15/2008'     --First Payment Date
            ,12               --Payments per Yer
            ,NULL       --Number of Paymens
            )           --End Period Number
      ,365              --Days in year
      ,0                --FV
      ,'A'              --IntRule
      ) as [2010 Interest Payments]
This produces the following result.
2010 Interest Payments
----------------------
1892.7364553898
 

(1 row(s) affected)



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