# Rate Function

Visual Studio .NET 2003

Returns a Double specifying the interest rate per period for an annuity.

```Function Rate( _
ByVal NPer As Double, _
ByVal Pmt As Double, _
ByVal PV As Double, _
Optional ByVal FV As Double = 0, _
Optional ByVal Due As DueDate = DueDate.EndOfPeriod, _
Optional ByVal Guess As Double = 0.1 _
) As Double
```

#### Parameters

NPer
Required. Double specifying total number of payment periods in the annuity. For example, if you make monthly payments on a four-year car loan, your loan has a total of 4 * 12 (or 48) payment periods.
Pmt
Required. Double specifying payment to be made each period. Payments usually contain principal and interest that doesn't change over the life of the annuity.
PV
Required. Double specifying present value, or value today, of a series of future payments or receipts. For example, when you borrow money to buy a car, the loan amount is the present value to the lender of the monthly car payments you will make.
FV
Optional. Double specifying future value or cash balance you want after you make the final payment. For example, the future value of a loan is \$0 because that's its value after the final payment. However, if you want to save \$50,000 over 18 years for your child's education, then \$50,000 is the future value. If omitted, 0 is assumed.
Due
Optional. Object of type `Microsoft.VisualBasic.DueDate` that specifies when payments are due. This argument must be either `DueDate.EndOfPeriod` if payments are due at the end of the payment period, or `DueDate.BegOfPeriod` if payments are due at the beginning of the period. If omitted, `DueDate.EndOfPeriod` is assumed.
Guess
Optional. Double specifying value you estimate will be returned by Rate. If omitted, Guess is 0.1 (10 percent).

#### Exceptions/Errors

Exception type Error number Condition
ArgumentException 5 NPer <= 0.

#### Remarks

An annuity is a series of fixed cash payments made over a period of time. An annuity can be a loan (such as a home mortgage) or an investment (such as a monthly savings plan).

For all arguments, cash paid out (such as deposits to savings) is represented by negative numbers; cash received (such as dividend checks) is represented by positive numbers.

Rate is calculated by iteration. Starting with the value of Guess, Rate cycles through the calculation until the result is accurate to within 0.00001 percent. If Rate can't find a result after 20 tries, it fails. If your guess is 10 percent and Rate fails, try a different value for Guess.

#### Example

This example uses the Rate function to calculate the interest rate of a loan given the total number of payments (`TotPmts`), the amount of the loan payment (`Payment`), the present value or principal of the loan (`PVal`), the future value of the loan (`FVal`), a number that indicates whether the payment is due at the beginning or end of the payment period (`PayType`), and an approximation of the expected interest rate (`Guess`).

```Sub TestRate()
Dim PVal, Payment, TotPmts, FVal, Guess, APR As Double
Dim PayType As DueDate
Dim Fmt As String = "##0.00"   ' Define percentage format.
Dim Response As MsgBoxResult
FVal = 0   ' Usually 0 for a loan.
Guess = 0.1  ' Guess of 10 percent.
PVal = CDbl(InputBox("How much did you borrow?"))
Payment = CDbl(InputBox("What's your monthly payment?"))
TotPmts = CDbl(InputBox("How many monthly payments do you have to make?"))
Response = MsgBox("Do you make payments at the end of the month?", MsgBoxStyle.YesNo)
If Response = MsgBoxResult.No Then
PayType = DueDate.BegOfPeriod
Else
PayType = DueDate.EndOfPeriod
End If
APR = (Rate(TotPmts, -Payment, PVal, FVal, PayType, Guess) * 12) * 100
MsgBox("Your interest rate is " & Format(CInt(APR), Fmt) & " percent.")
End Sub
```

#### Requirements

Namespace: Microsoft.VisualBasic

Module: Financial

Assembly: Microsoft Visual Basic .NET Runtime (in Microsoft.VisualBasic.dll)