I have a unique and yes even perhaps bizarre way of computing ytm simply as an educational exercise (not a useful tool).

It only uses an on-line loan amortization schedule calculator such as:

http://www.bankrate.com/calculators/mortgages/amortization-calculator.aspxThere is no "closed form" equation that will yield ytm given the set of parameters. Otherwise why bother.

So, again for educational purposes, enter the Folio asking amount (in pennies) as the loan amount (pennies needed for precision like 2500 for $25).

Enter the remaining number of months as the term.

Make a guess at the interest rate xx.xx% (when you finish this will be ytm).

Hit compute and the monthly payment will be computed and displayed.

Refine your interest rate guess so that eventually the monthly payment computed equals the existing monthly payment for the original loan.

Finally when you guess the interest rate that makes the new payment the same as the original then that interest rate is ytm.

Again, for the education of a complete noob, I ran this procedure for two loans.

One was pretty much dead on the same as the Folio provided and the other significantly higher.

Given the educational nature of the exercise is my procedure correct (meaning one of the Folio displayed ytm's is off badly) or is this my approach conceptually a bag of rubbish? Naturally I'd be curious as to what is wrong with the procedure of course.

TIA.