loans

Python based loans app

Description

Simple Python Based Loan amortization tool

Run FastAPI

uvicorn main:app --reload

Algorithm

Monthly payment is computed using:

payment = (principal * pow(rate + 1, term) * rate) / (pow(rate + 1, term) - 1)

Amortization schedule is computed as:

while principal > 0:
  interest_in_term = principal * (interest / 12)
  payment_less_interest = payment - interest_in_term
  if payment_less_interest < 0:
    break
  if principal < payment_less_interest:
    paid_principal = principal
  else:
    paid_principal = payment_less_interest
  principal = principal - paid_principal
  month += 1

In this implementation, monthly payment is computed, and then applied per month reducing the balance (principal) and calculating the principal and interest paid. Using the above formula, we can generate a schedule and store it in a JSON array. We can also compute the aggregate interest and principal paid.

Notes:

This implementation uses sqlite3 which adds functionality to make the data persist and allows us to be able to query the data.