rule of 78

rule of 78. A method for computing the amount of interest that a borrower saves by paying off a loan early, when the interest payments are higher at the beginning of the loan period. • For example, to determine how much interest is saved by prepaying a 12-month loan after 6 months, divide the sum of the digits for the remaining six payments (21) by the sum of the digits for all twelve payments (78) and multiply that percentage by the total interest. — Also termed rule of the sum of the digits.

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词条贡献者

双语律师李明，国际知名法学院法律专业，擅长翻译各类与政府监管相关的法律文件。