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Updated about 6 years ago on . Most recent reply

User Stats

28
Posts
8
Votes
Thomas Fawcett
  • Investor
  • Ankeny, IA
8
Votes |
28
Posts

How to calculate interest payout for my investor?

Thomas Fawcett
  • Investor
  • Ankeny, IA
Posted

Hey Guys, 

I have an investor I need to pay and I want to make sure I am calculating interest correctly.  Here is my example;

Loan had an initial 6 month period that was at 12% apr and then moved to 18%.  Loan period is from 6/11/2018 - 2/26/2019.  

Principal Invested   $10,000

6/11 - 12/11 @ 12% (6 months or 183 days)

12/12-2/26 @ 18% (2 Months 14 days  or 77 Days) 

When calculating interest do you use the total number of days or do you use months and then days? This is not a big deal but numbers will end up being slightly off and I want to know what is correct.  Not sure if I am doing this right but these are the results I got for interest payments with the two methods. 

Days Method = $981.37

Months and Days = $1,023.29

What is right or are both wrong?  Thanks for your help!!   

Thomas 

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