Simple Interest Calculator:

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What is Interest?

Interest is a monthly payment from the borrower to the Bank or any Moneylender towards the debt which has taken by the borrower from the Bank or any Moneylender. Interest may be the repayment of Principal amount which is borrowed by an individual from Bank or any other Moneylender at a particular percentage which is also known as Rate of Interest or Interest Rate.

What is Interest Rate or Rate of Interest?

Rate of interest or Interest rate is the percentage of an amount or principal amount which is taken by the borrower from a Bank or any other Moneylender imputes as an interest to the borrower. Normally this rate of interest or interest rate is indicates the annual percentage.

What is Simple Interest?

Simple interest is a monthly payment from the borrower to the Bank or any Moneylender towards the debt which has taken by the borrower from the Bank or any Moneylender. Simple Interest is based on the Principal amount and calculated according to the remaining balance of the Principal amount. Simple interest does not include any compounding and it can be applied over a term or time duration or a period of time.

What is a Simple Interest Calculator?

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Simple Interest Calculator is an electronic device which facilitates the people to persuade monthly repayments of a mortgage or a loan. Simple Interest Calculator helps the users to know their number of repayments for the loan which they are willing to take or already taken, the rate of interest they are paying for their loan. Simple Interest Calculator helps the people to calculate the monthly payment which they have to pay for the Moneylender or a Bank. By using this online Simple Interest Calculator anyone from any part of the world can calculate the interest to be paid, monthly payment etc.

How to use the Online Simple Interest Calculator?

Here we are giving some simple tips to use the Simple Interest Calculator in a simple and easy way. To use the Simple Interest Calculator first you have to know or decide the Principal amount, second thing is Interest rate or the rate of interest which is charging by the Bank or Moneylender, third and the last thing is duration or term or number of months. By using these three things you can simply calculate the monthly payment for the Debt taken from the Bank or any Moneylender.

Simple Procedure for Using a Mortgage Calculator Online:

  • Enter the Loan amount or Total amount which you are willing to take or already taken from the Bank or any Moneylender in the Loan Amount field.
  • Enter the rate of interest which was prescribed by the Bank or Moneylender in the Interest Rate field.
  • Enter the number of months for which you want to repay the loan in the Months field.
  • After entering all the above mentioned details in the specific fields and click the Calculate

How to Calculate the Simple Interest Manually?

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Before the existence of the Simple Interest calculator, there is a formula by using that formula people used to calculate. By using this below mentioned formula anyone from any part of the world can calculate the number of repayments for the loan they have taken from the Bank or Moneylender. For using this formula you can choose the principal amount how much you are willing to take as a loan, depending on the rate of interest and principal amount you can calculate the number of payments and the amount to be paid on every month.

Simple Interest Formula:

I = PxRxT

In the above formula, where

I – Interest.

P – Is Principal amount.

R– Stands for Rate of Interest.

T – Stands for number of payments.

Simple Procedure for Calculating the Mortgage Manually:

  • Substitute the Loan amount which you are willing to take from the Bank in ‘P’.
  • Substitute the rate of interest which was prescribed by the Bank in ‘r’.
  • Substitute the number of payments or repayments in ‘T’.
  • After substituting the Principal amount in ‘P’, rate of interest in ‘r’ and number of payments in ‘T’ in the above formula, you can get the ‘I’ is the Interest which you have to pay for the Bank.

How to Calculate Compound Interest Manually?

Before the existence of the Compound Interest Calculator, there is a formula by using that formula people used to calculate the compound interest. By using this below mentioned formula any person can calculate the annual compound interest.

Compound Interest Formula:

‘P = P (1 + r/n)

In the above formula, where

P’ – Compounding Interest.

P – Is Principal amount.

r– Nominal annual interest rate.

n – Stands for Compounding frequency.

t – Number of years for which the interest is applied.

Simple Procedure for Calculating the Compound Interest Manually:

  • Substitute the Principal amount in ‘P’.
  • Substitute the nominal interest rate in ‘r’.
  • Substitute the compounding frequency in ‘n’.
  • Substitute the total number of years in‘t’.
  • After substituting the Principal amount in ‘P’, nominal interest rate in ‘r’ and compounding frequency in ‘n’ and total number of years in ‘t’ in the above formula, you can get the P’ is Periodic Compounding.

Total Compound Interest Formula:

‘P = P + I

I = P (1 + r/n) – P

In the above formula, where

P’ – Compounding Interest.

P – Is Principal amount.

r– Nominal annual interest rate.

n – Stands for Compounding frequency.

t – Number of years for which the interest is applied.