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Former Member
Jul 09, 2009 at 09:30 AM

Interest calculations in foreclosure of loans

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Experts,

Scenario 1:G enerallywhile repaying loan how the interest will be calculated? (For repayment amount only or for whole loan amount)

Example

Loan amount sanctioned on 30.04.2009 =10000

Regular Repayment (starts on May2009) = 2500/month

Interest due = 50 (In IT0045 loan conditions given 6% monthly interest rate

How Rs.50 arraived?

Scenario2: In the case of foreclosure of loan how interest is calculated on general system?

Example

Loan amount sanctioned on 30.04.2009 =10000

Repayment starts on May2009 = 2500/month (50 interest due)

Foreclosure amount on June2009 = 7500 (37.50 interest due)

In this scenario our client have their own way of calculating interest, how to achive that?

i.e we don't want 37.50 as interest during foreclosure but want another amount to be as interest.

Please advise us in this, will be given full Pts

Edited by: SD.SK on Jul 9, 2009 12:51 PM