Loan/Mortgage payments with "adjusted" principle (eg after an extra principle payment), SOLVED

[azalea4va]

I recently switched to gnucash and had trouble setting up my mortgage account
because I had made extra principle payments in the past.  I search of this
board revealed others have had the same problem.  So I wrote some scheme
functions that take care of the problem.  This works for situations where
one is paying a constant amount each month, but that amount may be different
from the original monthly payment and/or the principle left is off schedule.

Problem review: gnucash is setup to deal with loans where payments are made
according to the original amoritization schedule.  But if the principle ever
gets out a whack with respect to whatever is determined by that schedule,
gnucash does not correctly compute how a payment gets divided into principle
and interest because the existing gnucash functions assume the balance at
any point are what the original schedule would have, not what the now
adjusted balance is.

There are four "variables in loan calculations: starting principle, interest
rate, term (number of payments), and monthly payment.  Given any 3, the
fourth can be computed.  Given those four values, one can compute how any
month's payment will be split between interest and principle. 

I put into my "home" directory the file "config.user" below with the
necessary functions. I then used the mortgage assistant to create the loan
account.  I specified the balance as the balance currently and the term as
the number of months left required to pay off the loan.  I then went to
Actions->ScheduledTransactions->ScheduledTranasactionsEditor, highlighted
the loan, and clicked on Schedlued->Edit=>TemplateTransaction.  I adjusted
the formulas there accordingly:

pmt( 0.03 / 12.000000 : 110 : 150000.00 : 0 : 0 )
  became (added the "i" and 1950 arguments)
pmtFixed( 0.03 / 12.000000 : i : 110 : 150000.00 : 0 : 0 : 1950)

ppmt( 0.03 / 12.000000 : i : 110 : 150000.00 : 0 : 0 )
  became (added the 1950 argument)
ppmtFixed( 0.03 / 12.000000 : i : 110 : 150000.00 : 0 : 0 : 1950)

ipmt( 0.03 / 12.000000 : i : 110 : 150000.00 : 0 : 0 )
  became (added the 1950 argument)
ipmtFixed( 0.03 / 12.000000 : i : 110 : 150000.00 : 0 : 0 : 1950)

An item of note (from the comment in config.user).

;; In real life, mortgage payments are made in distinct monthly payment. In
gnucash
;; those payments are processed with a precision to the nearest penny.  In
math,
;; they are processed with greater precision.  This can cause function using
pure
;; math to get out of sync (by a penny at a time) with what happens in a
gnucash
;; register.  These differences can be resolved by adjusting the results of
the
;; functions below to the nearest penny and using the recursive function
below
;; to compute the balance at any point (and not the non-recursive one). BUT, 
;; I appear to have found a bug in gnucash.  When one uses the schedule
editor,
;; the editor complains about parsing the functions when recursion is
included.
;; So the solution below uses the non-recursive function for computing
balance
;; after 'payNum' payments.  It has been my experieince (limited) that after
getting
;; everything setup in the schedule editor, I can change config.user to use
the 
;; recursive function and everything runs smoothly.  Just set config.user
back to
;; using balFixed2 temporarily if you ever need to go back into the schedule
editor.

config.user <http://gnucash.1415818.n4.nabble.com/file/n4692686/config.user>  



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