Loan comparison

Compare two or more loan offers — different rates, terms, fees, prepayment structures — on the metrics that actually matter (monthly payment, total interest, year-1 equity build, NPV at your discount rate, effective rate). Apples-to-apples math without opening a spreadsheet.

When to use this pack

You're choosing between two mortgage offers, a fixed vs. variable auto loan, a student-loan refinance, or a 15-year vs. 30-year structure. Raw totals lie (you can't compare $300k of 15-year payments to $300k of 30-year payments on total dollars — the 30-year wins on total cost only because you held the money longer). Compare on present-value terms and opportunity cost. All deterministic, all free over PoW.

Tools in this pack

• Loan payment $0.001 POST /api/loan-payment Compute the monthly (or per-period) payment on a fully-amortizing loan: mortgage, auto, student loan, business loan. Returns the periodic payment, total paid over the term, and total interest. Matches Excel's PMT(rate, nper, -principal). Use this when you just need the payment number, not the full per-period schedule (see amortization).
• Amortization schedule $0.001 POST /api/amortization Build the full per-period amortization schedule for a fully-amortizing loan. Each row reports the period number, payment, the principal vs. interest split for that payment, and the remaining balance after that payment. Use this when the user wants to see how interest tapers over the life of the loan, or to model an extra-payment scenario by reading the balance at any period.
• Compound interest $0.001 POST /api/compound-interest Compute future value of a principal under compound interest. Returns future value, total interest earned, and the effective annual rate (APY) given the compounding frequency. Matches Excel's FV(rate, nper, 0, -principal) and the classic (1+r/n)^(nt) textbook formula.
• Net present value (NPV) $0.001 POST /api/npv Compute the net present value of a stream of cashflows at a given discount rate. Index 0 is treated as t=0 (today, not discounted); indices 1..n are discounted by (1+rate)^t. Matches Excel's NPV but with the conventional t=0 treatment most finance textbooks use (Excel itself starts discounting at t=1 — see notes). Use for capital-budgeting decisions: positive NPV = creates value at the discount rate; negative = destroys value.
• Internal rate of return (IRR) $0.001 POST /api/irr Compute the internal rate of return (IRR) of a cashflow stream — the discount rate at which NPV = 0. Index 0 is treated as t=0 (typically the negative initial investment); indices 1..n are inflows in subsequent periods. Solved via Newton-Raphson with bisection fallback. Requires at least one positive and one negative cashflow (otherwise IRR is undefined). Multiple sign changes in the cashflows can produce multiple IRR roots — we return the first one found.

Workflow

1. Call loan-payment on each offer to get the monthly payment, total paid over the term, and total interest. For most plain fixed-rate comparisons (same principal, same term, just different rates), this single comparison settles it — pick the lower payment. Only keep going when the comparison is non-trivial (different terms, points, balloon payments, etc.).
2. Call amortization on each loan with maxRows=12 (or paymentsPerYear, whichever you'd rather inspect). Report the year-1 ending balance to surface equity-build differences — a 15-year loan pays off ~$13k of principal in year 1 on a $300k mortgage where a 30-year pays off ~$3k. That's the 'why pay more per month?' answer, and it's invisible from the payment number alone.
3. Compute opportunity cost with compound-interest. Take the per-period payment difference (Loan A monthly minus Loan B monthly) and ask: if I invested the savings instead, what would I have at the end of the term? Use the longer term and your assumed market return (default 7-8% for stocks, 4-5% for bonds). This is the layer that flips most 'obvious' comparisons — a higher-payment 15-year loan often loses to a 30-year + invest-the-difference once you price the opportunity cost honestly.
4. Run npv on each loan's full cashflow stream using your personal discount rate (default 5%). Build the stream as: [principal, -payment, -payment, ...] over the loan's periods. The loan with the less-negative NPV is cheaper in present-value terms. This is the right comparison metric when the terms differ — comparing raw total-paid on a 15y vs. 30y is dishonest because the dollars in year 30 are worth less than the dollars in year 1.
5. Use irr only for non-standard structures: loans with discount points (you pay $X upfront for a lower rate), balloon payments (low monthly + a giant final payment), prepayment penalties, or fees rolled into the loan. Build the actual cashflow stream and call irr — that's the all-in effective rate the loan is really costing you, comparable across structures. Plain fixed-rate loans don't need this step; their irr equals their stated rate.

Run it in Claude

claude mcp add agent402 -s user -- npx -y agent402-mcp@latest

Then paste this prompt into Claude:

Compare these two mortgage offers using Agent402: A) $300,000 at 6.5% for 30 years, B) $300,000 at 6.0% for 15 years. (1) Call loan-payment on each — record monthly payment + totalInterest. Expect A ≈ $1896/mo and B ≈ $2531/mo. (2) Call amortization with maxRows=12 on each; report each loan's balance after 12 payments to show equity build (B's year-1 principal paydown should be ~4x A's). (3) Compute opportunity cost: the monthly payment differential is ~$635 (B - A). Call compound-interest with principal=0, but instead approximate by treating the differential as an annuity: take the differential × 12 months × 30 years and run compound-interest on that as if invested at 7%/yr to get the upper-bound forgone investment. (4) Build cashflow streams for npv: A = [300000, -1896, -1896, ... (360 times)], B = [300000, -2531, -2531, ... (180 times)], call npv on each at discountRate=0.05 — compare the (negative) NPVs. (5) Skip irr because both are plain fixed-rate loans with no points / balloon / fees. (6) Return: {a: {monthly, totalInterest, year1Balance, npvAt5pct}, b: {monthly, totalInterest, year1Balance, npvAt5pct}, recommendation: "A" | "B", reasoning: "...one sentence explaining which layer was decisive."}. All five tools are free over PoW — only pay if you also fetch live rate data via finance-kit.

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