# How to Determine the Maturity Date of a Loan

The maturity date of a loan is the date upon which the principal amount of a loan becomes due and payable. For an installment loan that requires regular payments over time, the maturity date is the date upon which the entirety of the loan is due and payable. Loans have maturity dates so the lender is assured its money will be paid back within a set time frame. Calculating the maturity date for your loan is a fairly straightforward process.

## Step 1

Review your loan documents to determine the principal amount of your loan. The principal is the amount borrowed from the lender. If you have no loan documentation, ask the lender for the amount of the principal balance of the loan. For example, the loan may have a principal balance of \$10,000.

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## Step 2

Review your loan documents to determine the interest rate on the loan. Again, if you have no documentation, contact the lender regarding your interest rate. For example, the interest rate of your loan may be 5 percent per year.

## Step 3

Determine how frequently you must make payments on the loan, including the payment amount. The majority of loans require monthly payments. The loan documents contain the frequency of repayment. Otherwise, the lender may be contacted to obtain this information. In the example, the lender may require monthly payments of \$500.

## Step 4

Track the interest accrued per month against the principal paid off per month. The best way to track the payments are on a spreadsheet. In the example, take note of the principal balance of the loan, \$10,000. Create a column for each monthly payment. Write \$500 next to each month for the loan payment. Calculate the amount of interest per month. In our example, multiply 0.05 (5 percent) by \$10,000 to get a yearly interest of \$500. Thus, during the first month, the loan will accrue one-twelfth of \$500 in interest, or \$41.66.