Thanks!
No, this is not a reverse mortgage. It went from being a normal mortgage, then an interest only mortgage, then to a negative amoritizing mortgage.
Please don't judge. Some friends had their house on the market for sale, moved into their new house that they were purchasing. The deal on the new house was they could live there until their old house sold and the local bank would give them a mortgage on their new house for the amount needed (payout from old house + new mortgage = new house purchase.)
The new house owner got tired of waiting and changed the terms. Long term, the new terms would make it impossible for them to keep the new house. And they couldn't move back into their old house when the deal fell through.
I stepped in and offered to help. We agreed to mortgage terms, had a real estate attorney draw up the paperwork, and close the deal.
I let my friends set the monthly payment. Their old house was suppose to sell quickly - they had buyers. Well, that fell through. So I am looking at carrying this mortgage note for longer than I had planned. It wasn't a big deal when we were talking for a month or two of being the "bank." But now that it's going to be longer than a few months... I need a program or a math formula to calculate interest.
The loan is a "negative amoritizing loan". Translates to them paying less than the monthly mortgage interest amount is each month. It's not what I intended and not what I realized before closing. However, bless the attorney, he DID realize that at closing and made sure the buyers understood what it meant. The buyers were fine with it. So every month the principle balance grows (unpaid interest, plus new interest calculations.)
Since this is going on longer than planned, I need to calculate the monthly mortgage interest (5%) and add it to the growing principle each month.
This is just to illustrate the scenario - its not the real numbers.
The loan was amoritized over thirty years, interest only, with a balloon payment in twenty years. Interest is fixed at 5%.
Payment should be $600.00 a month (interest only no principle)
Payment is $400.00 a month (just part of the monthly interest being paid)
Negative interest is $200.00 (interest due but not being paid and is being added to the principle balance)
If the loan was only going to be a few months as planned, I wouldn't worry about recalculating interest each month. But this is going on way longer than original planned. The attny said he didn't do this kinda math (& neither did his program) since we don't know when the loan would actually be paid off or if any extra payments would be made (so far, no extra payments have been made.)
Thus, me looking for an app that would track all the math and calculate interest. Or a simple formula that would allow me to calculate interest each month.
I think if I could do a printout monthly and show the folks how much the loan is growing, then they'd be more motivated to pay extra on the loan. At least pay all of the interest each month. 
Actually just look at any number of calculators for compounding investment returns, add in a few withdrawals (payments) and you've got yourself a method to easily math out a compound interest mortgage.
Alternatively I'd probably let someone else handle it for me as JVille suggests.
Thanks.
Around here, real estate attorney's handle title work and closings. No title companies around for miles.
I think the best way to do this is to take the balance on the last day of the month, times the monthly percentage of interest (5%/12), and add that number to the principle. When the payment is made on the first, deduct that from the balance.
