Enter your previous unpaid balance, interest rate, additional purchases, and previous payment made towards the balance to determine the current unpaid balance.

Unpaid Balance Formula

The following formula is used to calculate the current unpaid balance given a previous balance, interest rate, additional purchases, and payments made towards the balance.

UB = PB*I + PB – DP + AP

  • Where UB is the unpaid balance ($)
  • PB is the prevoius balance ($)
  • I is the interest rate (%)
  • DP is any down payments made on the balance over the last month ($)
  • AP are additional purchases in the last month ($)

What are unpaid balances?

Unpaid balances are defined as the total amount due on a loan or credit card that has gone unpaid from the previous payment period.

In other words, the balance you will owe the next time a payment is due.

Example Problem

How to calculate an unpaid balance?

First, determine the previous balance on the credit card. For this example, the person had a previous balance of $300.00.

Next, determine the interest rate on the card. This should be the periodic interest rate, which in this case, is found to be 15%.

Next, determine any amount of payments made to the unpaid balance. Over the last month, the person in this example paid $50 towards the balance.

Next, determine any additional purchases made with the card. For this example, there was 25$ worth of purchases made on the card.

Finally, calculate the next/current unpaid balance using the formula above:

UB = PB*I + PB – DP + AP

UB = 300*.15 + 300 – 50 + 25

UB = $320.00.