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Questions tagged [interest]

for questions that relate to interest. Interest is a fee paid by a borrower of assets to the owner as a form of compensation for the use of the assets.

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0answers
47 views

Interest expense deduction on rental property that was re-financed to pay off wife for her interest in home

I am in California in the United States. I stated renting my house out this year (2017). I originally purchased the home with my ex-wife in 2001, but bought her interest in the property as part of ...
8
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2answers
605 views

Large loan at zero interest or very little interest?

I have a big problem but a lucky solution. I have a huge amount of debt, student loans that add up to hundreds of thousands of US dollars. I have a relative who is willing to give me a loan to cover ...
0
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1answer
163 views

Does 0% APR mean I'm not charged interest? [duplicate]

If a credit card says you get something like, "0% APR for the first 12 months," does that mean you can get by with paying only minimum payments and not have any accrued interest build up? If so, ...
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0answers
54 views

Investment or saving options Northern Europe

I am interested in basic financial advice for my current situation. I am mid twenties, living in Northern Europe and have gathered some savings over the years. Currently living in a rented apartment, ...
2
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1answer
114 views

What credit card surcharge rate should I accept?

I have a long-term revolving debt account where interest is charged only for the outstanding balance. I am using a credit card for regular expenses in order to maximize the duration that money stays ...
3
votes
1answer
380 views

Hotel, double charges, overdraft and bank interest

Situation: During check-in at a hotel, I give them my (debit) card, do paperwork (fill in forms, sign documents and so on...). They hold some funds ($100 for example). Finally, during check-out, ...
1
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1answer
343 views

Calculating the number of years before an investment with increasing savings reach a certain value

I want to calculate the number of years required before an investment reach a certain value assuming increased payments. Ignoring the increase of payments, I can calculate using NPER (Google Sheets, ...
4
votes
1answer
610 views

Is the principal of a savings bond taxable, or only the interest?

Let's say I cash out some government savings bonds with a face value of $2,000. Since they are 10% bonds the total amount I get when I cash them out is $2,200. Do I owe taxes on the full $2,200 (...
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6answers
1k views

Pre-pay mortgage in full - do you have to pay off the projected interest as well?

How does paying off a mortgage early work? Example: I have a 30 year fixed rate mortgage of 3.5%, the amount borrowed is $300,000. I have just inherited $300,000. I am in the first year of the ...
32
votes
2answers
13k views

Why does my car loan interest go up despite making payments on-time?

In my first payment on 06-17-2016, the principal applied to my balance was $186.76 and the interest was $107.50. As I kept making the payment on-time, the second payment on 07-25-2016 was a bit of a ...
7
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5answers
715 views

How to correct interest rate for inflation?

I'm looking for someone to double check my math and who can tell me if I have correctly accounted for inflation. Say you hypothetically invest $100 with 7% rate and 2% inflation. You would end up ...
1
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1answer
53 views

Is transfer of long term investment proceeds from India considered taxable in the U.S.?

I am Indian origin and I have done many investment in India thru NRE bank account.(legally send money to India.) I have done all investment after I pay taxes in USA. All investment are long term, so ...
3
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2answers
1k views

Credit Card no interest period

A few weeks back I asked a question about getting a new credit card, and the answers were very helpful, but I came into some new information that I at the time I had not realized. My credit card ...
0
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2answers
325 views

A little advice please…car loan related

I have a car loan out that is $10,000. It's actually a personal loan at 10% interest rate. The vehicle is about 10 years old and has 135,000 miles. The KBB value is around $4,000. It's having ...
1
vote
1answer
636 views

Why does a bank deduct interest first and principal later

I want to buy a house but there is this one thing about the bank loan I am not able to understand. Lets say I am taking loan of 60L rs. and I start an EMI of X amount. The state bank of India (all ...
6
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3answers
1k views

Will having a secondary signee with bad credit on a mortgage raise or lower interest?

My girlfriend and I are purchasing a house. We were told that it would be better to have the mortgage solely in my name as the only account holder due to her credit score. My question is, between ...
4
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3answers
138 views

How do the UK's savings and dividends taxes (2016+) interact with the personal allowance?

The UK has rationalized it's tax treatment of interest on savings and dividends (NB this question is concerned entirely with investments held outside of SIPP or ISA tax wrappers). More details here ...
2
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2answers
827 views

Max allowances on w4, and not pay income tax till end of year?

Is there a reason that I can't do the max number of allowances on my w4, and pay no income tax during the year? I would then put the amount that you are normally supposed to withhold every pay check ...
3
votes
1answer
287 views

Why does my interest charged (on loan) fluctuate from my own calculations?

I just want to know if I am calculating the interest correctly. Or is the interest rate is fluctuating slightly? Its not really that big of a fluctuation (we're looking at a range of 5-10 cents off). ...
4
votes
1answer
84 views

Does it make any sense for UK private investors to hold gilts directly and outside of a tax wrapper?

According to my understanding of gilts (which is in accordance with the answers here), private investors in UK gilts paying a premium on the redemption price (for example 2% T20s currently report a ...
0
votes
1answer
163 views

Does Gold Pay Interest In Negative Rates?

From my SO the other night: Gold pays interest when there's negative rates. If someone holds gold, they have to store it in a manner that will cost (money or time) and if someone holds gold in a ...
3
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2answers
298 views

Mortgage change of terms (lower rate) increases payment amounts

My bank now offers lower interest rates than what I got when I first started my mortgage. I called to see about changing my terms (lower rate, same payoff date), and they said it would actually ...
0
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1answer
531 views

How do I prevent my credit card interest from capitalizing?

I have a fairly standard point-rewards Visa credit card - I want to keep the interest on it from capitalizing, so whenever I make a purchase of over $50, or feel like I've made a large number of ...
2
votes
5answers
3k views

Calculating interest for a loan made for a friend on a credit card

I have a credit card with a 16.5% APR. I had $2500 on the card already. I made a purchase for a friend of $3700, who has just paid me back after 11 months. How can I calculate the interest he would ...
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2answers
314 views

How can change in open interest of a particular day be less than volume traded on that particular day for an options?

this is the image of nifty option chain. I am new to options trading and I learnt that open interest change can occur only upon a transaction. But here, the change in open interest is less than ...
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2answers
14k views

does interest payment on loan stay the same if I pay early

Hopefully, my question doesn't sound dumb, because I'm not a finance guy. Suppose I have a 100k loan, and the monthly payment is 1k. My loan payment goes 600 to interest and 400 to pay down ...
1
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2answers
67 views

Time given future value of reoccurring deposit

I've recently come across the follow formula for calculating future value with reoccurring deposits formula. However, I have been unable to solve for t. I essentially want to find how long it will ...
0
votes
3answers
251 views

What type of an account to store emergency fund? [duplicate]

I'm working on building up my emergency fund. I put the money into an Ally online savings account yielding 1% interest. Would it be wise to put the money somewhere else that gives a higher rate of ...
0
votes
1answer
55 views

Interest on American dollars in Australian bank account

I have American dollars in an Australian bank account, which doesn't accrue any interest. Is there a way of getting interest on it?
39
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3answers
12k views

Can I take out a loan and invest it at higher interest?

I noticed today that my bank is offering small loans of up to £15000 at 3.3% interest. Meanwhile, services like Zopa and RateSetter are offering over 6% interest on investments in their platforms. I ...
2
votes
1answer
116 views

How to handle fee for a balance transfer?

To save some money on interest, last week I transferred a balance of $17,500 from my student loan account to my credit card for 0% APR for 18 months and a 2% transfer fee. The transfer fee ($350) ...
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3answers
235 views

Comparing the present value of total payment today and partial payments over 3 months

I'm trying to buy something. I can either pay $2495 in a lump sum payment, or $997 over 3 x monthly installments. Let's say I can invest in the stock market and get an 8% return on my money. What's ...
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2answers
901 views

Why is there so much interest on home loans?

Search around the internet for current mortgage rates and play with some of the amortization calculators. You'll see that at the end of the payment schedule you will be paying almost an equal amount ...
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4answers
472 views

IRR vs. Interest Rates

This is a simple question but I just wanted to be sure. Say I have an IRR of 5%. Does this mean that I have an actual return of (1.05)^3 - 1 = 15.7%?
30
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9answers
11k views

Is asking to pay off principal first a placebo?

Some people say that in order to pay off a loan sooner, you should ask the lender to "apply your payment towards the principal", so that they won't "apply your payment towards the interest". From my ...
4
votes
1answer
324 views

Credit card creditors have two approaches to handling interest

Most credit cards calculate interest at the end of the cycle and add it to the balance: this reduces the available credit. As an extreme case, when this goes over limit the cardholder is required to ...
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1answer
144 views

Borrowing money for investment

What do you consider the best way to: Borrow money from private investors against a fixed interest rate Use it to trade, yielding a higher return than the interest rate Pay off the investors with ...
1
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1answer
294 views

Alternatives to Bank Accounts

I have both a savings and checking account with Wells Fargo and I'm just getting disappointed by the fact that I don't get hardly any interest. Is there somewhere else I could stick my money so that ...
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3answers
2k views

“Simple interest rate of 0.10%” corresponds to “APY of 2.54%-5.00%”… how?

This checking account says Balances above $5,000 earn a simple interest rate of 0.10%, with a corresponding APY of 2.54%-5.00% APY. I don't understand how a simple interest rate that is a fixed ...
5
votes
3answers
824 views

Why UK bank charges are not taken account when looking on interest for taxation?

In UK when filling-in self-assessment, HMRC is asking for amount of interest received during the tax year. But bank charges are not taken into account. See example here: my bank charges me £5 ever ...
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2answers
61 views

How to safely earn interest on business profits (UK) [closed]

I have a good sized amount of money in a UK (Barclays) business bank account earning exactly zero interest. I'd be happy even to earn 1% interest on that money so long as it was totally safe, but I ...
4
votes
1answer
214 views

Is it better to hold cash in a mortgage offest or term deposit account long term?

I am refinancing a variable rate mortgage (current rates are low and expected to fall further in the next 12 months - currently 4.25%). I have a cash sum equivalent to about 20% of the full loan ...
0
votes
1answer
145 views

Handling loan on flat to rent

I intend to buy 2 room flat and rent it. Flat costs 240k and I have 70k in cash. I expect to get paid 2k per month from renting flat (1k per room). Bank requires my minimal contribution of 10% of flat ...
32
votes
11answers
10k views

Should I charge my children interest when they borrow money? [closed]

My children (both male, ages 25, soon to be married, & 32, married) have borrowed money from me and my wife on several occasions. They have yet to pay us back what they borrowed. We have never ...
32
votes
13answers
9k views

Do I pay a zero % loan before another to clear both loans faster?

I have $11,000 to put toward one of my three loans. I think I should pay off the 0% car loan and then in two months it will be zero and I can apply that $635 to the 2.5 % car loan and pay it down ...
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2answers
154 views

How to calculate interest gained by paying off credit card right before the due date and not earlier?

By not paying off the credit card statement amount right after it is generated but closer to the due date, the same funds can be in a savings account generating interest. I'd like to know precisely ...
8
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5answers
4k views

Paying off a loan with a loan to get a better interest rate

I've never had credit or a loan till recently when I bought a new car. This has recently given me a much better credit rating after having the loan for a year with 5 years to go and 2 credit cards ...
4
votes
1answer
550 views

Inflation adjusted total formula for cost of mortgage

True cost of a mortgage when considering inflation has an answer by a Chris Degnen with the relevant formula(s): adjusted = (p - (1 + inf)^-n*p)/inf; pv = Σ p2 (1 + r2)^-k for k = 1 to n ∴ pv = (p2 ...
19
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5answers
3k views

Should I buy a house because Mortgage rates are low

Interest rates are pretty low right now and a few of my friends are rushing to buy a house(even though the actual property prices are pretty high.) I was of an opinion that mortgage rates being low is ...
-1
votes
1answer
627 views

Does a one time additional payment reduce the interest paid on a Prosper or Lending club personal loan

I have a loan with Lending Club with a certain interest rate. So every month I pay the principal as well as about $200 in interest. Assuming the loan balance left is $20000 and the interest rate is 7%,...