Forecasting Loan Interest Payments

Using FUTRLI Formula Method, we can quickly and simply forecast Loan Interest payments. In this guide we’re going to walkthrough entering a simple Loan Interest payment.

Written by Ross MacLeod


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Using FUTRLI’s Formula Method, you can quickly and simply forecast Loan Interest payments. In this guide we’re going to walkthrough entering a simple Loan Interest payment and then demonstrate how to set this interest against the value of the loan.

Forecasting a Loan Interest Payment

Within the Scenario, navigate to the Interest Expense line and create a new Forecast Item. You will need to use FUTRLI’s Forecast Formula method to enter the Interest Payments:

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In this example we’re going to be forecasting the payment of a £100,000 loan over 3 years with 5% annual rate of interest payable monthly. Using FUTRLI formula method, we can quickly and simply enter our Interest Expense calculation:

  • Type in the formula: £100,000 multiplied by 0.05 gives the annual interest payment, dividing by 12 makes this a monthly figure of £417:

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  • It is a monthly calculation so select ‘monthly periods’.
  • Set the first invoice date as the first loan repayment date.
  • Set the VAT to zero.

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  • ‘Repetition Pattern’ – select yes to make the calculation repeat and set to end after 36 periods (3 years in this example):

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Hit Save Changes and the Interest Expense will be calculated and applied to the Forecast:

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The balancing entry to this expense can be seen in the default bank account:

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Adding the interest to the value of the loan

If the interest payable on the loan is added to the value of the loan outstanding, then you will not want your bank account affected. For this we use the Advanced Options, found in the bottom right of the window:

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Click advanced options on the initial Forecast screen. If you have already saved you can access the same screen by selecting edit on an existing Forecast:

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Here simply select no cash and choose the Account you wish to be credited rather than the bank.