Irregular Payment and APR

I am looking at a consumer mortgage loan that has the following payment structure: 120 mo P&I; fixed rate; with an add'l $10,000 principal pmt due annually on the anniversary date of the loan. The addt’l principal payment is disclosed via a separate addendum to the note but is not included in the APR calculation. When I enter the loan into APRWIN, I get a huge APR and finance charge understatement. I used the irregular tolerance of .25%. Am I correct that the $10,000 annual principal payment must be included in the APR calculation?

The APR would be for the terms of the contract. Richard would probably be the best to answer, but it might appear that you have 11 payments, followed by the payment plus the $10,000, then repeat 9 more times.

I entered the payment stream as follows:

1 - $1551.58, 119 pmts
2 - $1553.95, 1 pmt (this is the final pmt)
3 - $10,000, 9 pmts (I used 9 since there wouldn't be a $10,000 pmt at maturity)

I come up with an understated APR by 5.4378 and understated finance charge by $89,643

I used a .25% tolerance (assuming this qualifies as an irregular loan)

Am I on the right track?

What about matching the note.
11 x $1,151.58
1 x $11,151.58

repeat 10 more times then

11 x $1,151.58
1 x $1,153.95

That's the right way to to the calculations, but (due to a software flaw) I think APRWIN chokes somewhere short of 20 payment streams.