Analysis Table 5
Print

May 1991

Case 2: Repayment Mortgage

£40,000 Borrowed over 20 Years @ 11.85% p.a.

Analysis Table 5

A

B

C

D

E

F

G

H

I

J

K

L

Year

Gross Cash Flow Out

Interest Paid

Principal Repaid

Interest
Applicable
for Tax
Relief

Tax Relief
on Interest

Tax
Relief on
Premium

Net Cash
Flow Out

@ x% Internal Rate of Return

Tax Relief at 52% p.a.

@ 14.5%

@14.4%

@14.345%

 

pv

pv

pv

pv

1

5472.88

4740.00

564.88

3200.00

1664.00

10.92

3797.96

3317.00

3319.90

3318.88

 

FV = P(1 + i )n

= £40,000 (1.1185)20

i.e. FV = £375,646.86

2

5472.88

4673.06

631.82

3200.00

1664.00

10.92

3797.96

2896.94

2902.01

2900.23

3

5472.88

4598.19

706.69

3200.00

1664.00

10.92

3797.96

2530.08

2536.72

2534.39

4

5472.88

4514.45

790.43

3200.00

1664.00

10.92

3797.96

2209.68

2217.41

2214.70

5

5472.88

4420.78

884.10

3200.00

1664.00

10.92

3797.96

1929.85

1938.30

1935.33

6

5472.88

4316.02

988.86

3200.00

1664.00

10.92

3797.96

1685.46

1694.32

1691.21

7

5472.88

4198.84

1106.04

3200.00

1664.00

10.92

3797.96

1472.01

1481.04

1477.88

8

5472.88

4067.77

1237.11

3200.00

1664.00

10.92

3797.96

1285.60

1294.62

1291.46

9

5472.88

3921.17

1383.71

3136.94

1631.21

10.92

3830.75

1132.49

1141.43

1138.29

10

5472.88

3757.20

1547.68

3005.76

1563.00

10.92

3898.96

1006.69

1015.52

1012.42

11

5472.88

3573.80

1731.08

2859.04

1486.70

10.92

3975.26

896.41

905.06

902.02

12

5472.88

3368.67

1936.21

2694.94

1401.37

10.92

4060.59

799.69

808.12

805.16

13

5472.88

3139.23

2165.65

2511.38

1305.92

10.92

4156.04

714.84

723.01

720.14

14

5472.88

2882.60

2422.28

2306.08

1199.16

10.92

4262.80

640.35

648.23

645.46

15

5472.88

2595.56

2709.32

2076.45

1079.75

10.92

4382.21

574.92

582.51

579.84

16

5472.88

2274.51

3030.37

1819.61

946.20

10.92

4515.76

517.42

524.70

522.14

17

5472.88

1915.41

3389.47

1532.33

796.81

10.92

4665.15

466.84

473.83

471.37

18

5472.88

1513.76

3791.12

1211.01

629.73

10.92

4832.23

422.33

429.02

426.67

19

5472.88

1064.51

4240.37

851.61

442.84

10.92

5019.12

383.11

389.52

387.27

20

5472.88

562.02

4742.86

449.62

233.80

10.92

5228.16

348.53

354.67

352.51

(Column F) Total

26,028.49

PV = pv

25,230.24

25,379.94

25,327.37

N.B.

Arithmetic Average (per month)

£108.45

yields FV 4

378,469.70

374,120.13

375,636.32

OK