Pitch Presentation Loan Calculator

• Many people and organizations depend on loans to fund projects
• Hence loans are a widespread and “real life” phenomenon many have to deal with
• The underlying maths is relatively simple
• However, calculation results seem counter-intuitive and surprising to many
• The app at hand shall users help to
  • play around with the key parameters and generate scenarios in doing so
  • compare different loan types offered by lenders
  • develop an understanding for the payments and parallel savings necessary over time

The user interface of the app asks for three basic parameters

• loan
  • this is the total amount of the loan
• interest
  • the (fixed) interest rate in percent for the loan
• credit period
  • in how many years the loan will be paid back

Additionaly, users can enter a start date of the loan to caclulate in which year (approximately) the loan will be paid off.

The following code part represents the core calculation of the app:

loan <- 300000 ; interest <- 5.5 ; period <- 30 
# Example for a loan of 300000, an interest rate of 5.5 percent and a credit period of 30 years
# The formula below calculates the so called annuity, i.e. the necessary annual sum of back payments
loan * ((1+(interest/100))^period*(interest/100))/((1+(interest/100))^period-1) 

[1] 20641.62

• One feature of the app is to list how annuities accumulate over time.
• We use a loop to generate the annuities for the given parameters.
• The annuities are then accumulated using the function cumsum.
• The resulting vector is then used as basis for a bar plot.

The Loan Calculator is …

• easy to use | only four input parameters are needed
• provides detailed results | e.g. monthly and yearly back payments at a glance
• has good performance | due to its lean design
• allows future extensions | e.g. additional graphs, solve for different parameters ..

We hope you find Loan Calculator helpful!

URL to GitHub: https://github.com/SpiessJ/repohannes

Feel free to get in touch: jkhspiess@gmail.com