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Tag Archives: Average Life Formula
Fast Formulas #3: The Spreadsheet
Fast Formulas #3: Pool Average Life with CPR Prepayments showed a shortcut for finding the weighted average life (“WAL”) of a homogenous pool of loans assuming a constant prepayment rate. The shortcut, Formula 3.1, takes just a few steps to calculate … Continue reading
Posted in Fast Formulas, Math, Spreadsheet Tips
Tagged Average Life Formula, Excel Tables, Fast Formulas, Weighted Average Life
2 Comments
Fast Formulas #3: Pool Average Life with CPR Prepayments
Fast Formulas #2: Average Life of Mortgage (Amortizing with Balloon) presented a compact formula for calculating the average life of a mortgage that pays as scheduled until it is paid off with a “balloon” payment before the scheduled end of its term. It occurred to … Continue reading
Fast Formulas #2: Average Life of Mortgage (Amortizing with Balloon)
Fast Formulas #1: Average Life of Mortgage (as Scheduled) showed a quick way to calculate the weighted average life (“WAL”) of a fixedrate mortgage that pays as originally scheduled. I found this formula (which is probably not original) by substituting the standard level … Continue reading
Posted in Fast Formulas, Math
Tagged Average Life Formula, Closed Formula, Fast Formulas, Financial Math, Loan Average Life, Math, Weighted Average Life
12 Comments
Fast Formulas #1: Average Life of Mortgage (as Scheduled)
The weighted average life (“WAL”) of a mortgage is the average time until principal is repaid. It is also the average amount of time that the principal is outstanding. Recall that for a standard fixedrate mortgage with level payments, the principal … Continue reading
Posted in Fast Formulas, Math
Tagged Average Life Formula, Closed Formula, Fast Formulas, Financial Math, Loan Average Life, Math, Weighted Average Life
9 Comments
Puzzle #3: A Better Answer
Puzzle #3 asked for the weighted average life (“WAL”) of the principal payments for a 30year mortgage that is cut short by a balloon payment at 15 years. The following information was provided: $100,000 Principal; 5% Interest Rate; $536.82 Level … Continue reading
Posted in Fun, Math, Puzzles
Tagged Average Life Formula, Cool Graphs, Finance Math Puzzle, Financial Math, Math, Puzzle, Puzzle #3, Weighted Average Life
5 Comments
Puzzle #3: Mortgage with Balloon
Puzzle #1 posed the question: given a $100,000 mortgage at 5% with monthly payments of $536.82 for 30 years, what is the average life of the principal payments? The puzzle was to be solved with just a few simple calculations. … Continue reading
Posted in Fun, Math, Puzzles
Tagged Average Life Formula, Bond Math Puzzle, Finance Math Puzzle, Financial Math, Math, Puzzle, Puzzle #3, Weighted Average Life
22 Comments
Puzzle #1: Mortgage Average Life
Here is the first in a series of puzzles that might have something to do with finance or math. The first to respond with a correct answer will be recognized in The WellTempered Spreadsheet Hall of Really Smart People. First, … Continue reading
Posted in Fun, Math, Puzzles
Tagged Average Life Formula, Bond Math Puzzle, Finance Math Puzzle, Financial Math, Puzzle, Puzzle #1, Weighted Average Life
21 Comments