The premium for a cap or floor is normally paid upfront by the borrower. Some borrowers prefer to pay the premium in instalments. The Instalments Calculator indicates the instalment amounts.

The size of each instalment payment depends on four factors:
• The amount of upfront premium to be deferred
• The length of the repayment period (normally the duration of the underlying loan)
• Whether the instalments payments are monthly or quarterly
• The funding charge applied by the lender in respect of the instalment payments
The calculator also expresses the instalment payments as an annual percentage of the underlying loan amount.