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HP 17Bii, 17Bii+, and 19Bii Calculators - Calculating Skipped Payments

Description
Sometimes a loan (or lease) can be negotiated in which a specific number of monthly payments are going to be skipped each year. Seasonality is usually the reason for such an agreement. For example, because of heavy rainfall, a bulldozer cannot be operated in Oregon during December, January, and February. Lessees who wish to make payments only when their machinery is being used will make nine payments per year, but the interest will continue to compound during the months in which a payment is not made. The following equation calculates the monthly payment amount necessary to amortize the loan in the specified amount of time. The payment occurs at the end of the month and the term of the loan must be an integral number of years.
 note:
This equation assumes that the payment will occur at the end of the month, and the term of the loan will be an integral number of years.
Calculating skipped payments
To calculate skipped payments, do the following:
  1. Enter the SKIPPED equation into the Solver as follows:
    SKIPPED:LOAN÷(1-L(V:1+I
    %÷P/YR÷100)^(-P/YRx#YRS)
    )x(G(V)^P/YR-1)x(G(V)-1)
    ÷(G(V) ^P/YR-G(V)^(P/YR-
    LPMT)+G(V)^(P/YR-#SKP-LP
    MT)-1)=PMT
  2. Verify the equation:
    • For the HP 17bii and 17bii+, press EXIT, EXIT, YES (to save), then CALC
    • For the HP 19bii, press CALC
  3. Store or calculate the following variables:
    • Loan amount in LOAN
    • Annual interest rate as a percent in I%
    • Number of payments per year in P/YR
    • Total number of years in #YRS
    • Number of last payment period before payments close the first time in LPMT
    • Number of skipped payments in #SKP
    • Monthly payment amount in PMT
Example of calculating a loan with skipped payments
A bulldozer worth $100,000 is purchased in September. The first payment is due one month later (October), and payments continue for five years. Because of the weather, the machinery will not be used during the winter months, and the purchaser does not wish to make payments during January, February, and March (months four through six). If the annual interest rate is 14 percent, what monthly payment is necessary to amortize the loan?
Keys
Display
Description
Press 100000, then LOAN
Loan=100,000.00
Enter loan amount
Press 14, then I%
I%=14.00
Enter APR
Press 12, then P/YR
P/YR=12.00
Enter periods per year
Press 5, then #YRS
#YRS=5.00
Enter loan term
Press 3, then LPMT
LPMT=3.00
Enter payment before first close
Press MORE
More variables
Press 3, then #SKP
#SKP=3.00
Enter number of skipped payments
Press PMT
PMT=3119.89
Solve payment

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