Answer to Question #52655 in Accounting for nadine

Question

using a 365-day calendar year, what is the interest due at closing for $54,750 mortgage loan at 8% interest for 23 days?

Answer 1

If we use a 365-day calendar year, the interest due at closing for $54,750 mortgage loan at 8% interest for 23 days will be:
Interest payment IP = PV*i*t/365, where PV - present value of a loan, i - interest rate, t - number of days.
IP = 54,750*0.08*24/365 = $288