How to Calculate an Outstanding Balance

Calculating the outstanding balance on a loan is necessary for those who are trying to understand how much more principal they need to pay on the loan before it is paid off. When calculating the outstanding balance, you do not need to factor in the amount of interest paid or the amount of interest that will be paid in the future. The outstanding balance refers to principal only.

Instructions

1

Write down the initial amount of the loan. For example, if you borrowed $10,000 to buy a car, write "$10,000."

2

Write down the amount of money you have paid toward the principal of the loan. For example, if you have paid $2,755 in principal, write "$2,755."

3

Subtract the number in Step 2 from the number in Step 1. For example, if you subtract $2,755 from $10,000, you would get $7,245. This means that $7,245 is your outstanding balance.