BEHIND THE NUMBERS
How this calculation works
Interval interest = unpaid principal × annual rate × actual days / annual divisor. Each payment clears accrued interest first, then reduces principal. Unpaid interest never joins principal.
Worked example
At 12% with a 360-day divisor, 30 days on $1,000 accrue $10. A $100 payment clears $10 interest and $90 principal. Another 30 days accrue $9.10 on $910, leaving $919.10.
Example result: US$919.10
A small payment may leave principal unchanged
When a payment is less than accrued interest, the unpaid interest carries forward separately. Further interest continues to accrue only on the principal.
The divisor is part of the agreement
Actual days / 360 and actual days / 365 give different results. Neither option is 30/360: the calculator always counts real calendar days, including leap days.
Assumptions and rounding
- No interest is outstanding at the start date. The rate stays constant.
- Intervals exclude their first date and include their last date. Equal-date payments add no elapsed days. Full precision is retained until display.
Questions about this calculator
Does unpaid interest compound?
No. It remains a separate balance and does not generate interest.
Can two payments have the same date?
Yes, if the rows remain in chronological order. The second payment has no additional elapsed days.