Financial math, continued: calculation of mortgage payment using the TI BA-35 financial calculator

Tutoring math, you’re often asked, “Will I ever use this in life?”  About this particular topic, the math tutor responds, “I hope so.”

Back in my October 16 post on mortgage payments, I opened the topic with the use of mortgage tables. While I still prefer them, the world is moving towards calculators instead.

With so many financial calculators available, their use is an exciting topic to embark. Today I’ll look at my old TI BA-35; the model in front of me is, I believe, from the late 90s. Given this calculator’s commonality, plus the fact that calculator instructions usually remain fairly consistent from the old model to the newer one, I think it’s definitely worth talking about.

I’m going to give commentary on how to calculate the mortgage payment for the same situation posed in my October 16 post. Here are the parameters I was using:

loan 300 000
interest 6.5%
term 25 years
payment frequency monthly

With the TI BA-35, I suspect that changing modes to STAT, then back to FIN (by keying in 2nd FRQ, then 2nd N), will clear the old data. I don’t know this for sure, but it seems to work for me. At any rate, I make sure I’m in FIN mode (if so, you’ll see FIN at the bottom of the screen), then I key in the parameters like so:

300000 PV
0 FV
12×25=N
(the total number payments: monthly for 25 years)
Be careful here: 6.5÷12=%i

Now, to find the payment, I key in

CPT PMT

After a few seconds, the amount 2025.6215 shows on the display. Note this matches the monthly payment from my October 16 post.

Important to notice: with the TI BA-35, you need to enter the monthly interest rate (the interest rate divided by 12) to indicate monthly payments.

I’ll have much more to say about this in future posts; today was just to start us off with the TI BA-35:)

Jack of Oracle Tutoring by Jack and Diane, Campbell River, BC.

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