# Rate Function

**Office 2013 and later**

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

**Syntax**

**Rate( nper**,

**,**

*pmt***[,**

*pv***[,**

*fv***[,**

*type***]]]**

*guess***)**

The **Rate** function has these named arguments:

Part | Description |
---|---|

| Required. |

| Required. |

| Required. |

| Optional. Variant 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. |

| Optional. |

| Optional. |

**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*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).

Dim Fmt, FVal, Guess, PVal, Payment, TotPmts, PayType, APR Const ENDPERIOD = 0, BEGINPERIOD = 1 ' When payments are made. Fmt = "##0.00" ' Define percentage format. FVal = 0 ' Usually 0 for a loan. Guess = .1 ' Guess of 10 percent. PVal = InputBox("How much did you borrow?") Payment = InputBox("What's your monthly payment?") TotPmts = InputBox("How many monthly payments do you have to make?") PayType = MsgBox("Do you make payments at the end of the month?", _ vbYesNo) If PayType = vbNo Then PayType = BEGINPERIOD Else PayType = ENDPERIOD APR = (Rate(TotPmts, -Payment, PVal, FVal, PayType, Guess) * 12) * 100 MsgBox "Your interest rate is " & Format(CInt(APR), Fmt) & " percent."