I'm trying to figure out how banks calculate their loan interests.
Let's say i ask the bank for 125 329,00 $ at a fixed interest rate of 0.99% over 240 months. In my own calc, I estimated a total loan interest of 12 522.18 $.
Something like 52.18 $ month, a monthly payment of 574.38 $ with the pay back.
But looking at the banks' offer I see 575,82 $ (+1.44 $ diff) and I cant see any possible explanation for this. Am I doing something wrong?
Hint: The equation to calculate the monthly payment is
$$125329\cdot \left(1+\frac{0.0099}{12}\right)^{240}=x\cdot \frac{\left(1+\frac{0.0099}{12}\right)^{240}-1}{\frac{0.0099}{12}},$$
where $x=575.82$ is the constant monthly payment and $\frac{i}{12}=\frac{0.0099}{12}$ is the monthly interest rate.