The interest on your loan is calculated using a fixed interest rate, and payable on the loan balance owing on your loan.

MoneyPlace calculates interest on a daily basis so that you pay less interest if you make extra payments on your loan or choose to pay it out early.

For example, if you have borrowed $10,000 from us and your interest rate is 8.00% p.a, then the daily interest will be $2.19. This is calculated as follows:

= $10,000 x (.08/365) x 1

= $2.19 per day

MoneyPlace collects the interest when you make your monthly scheduled repayments on the loan.

**How much would I save if I made an extra repayment on the loan?**

The amount of interest you will save depends on how much you put towards reducing the loan balance. For example, if you made an extra payment $500 towards the loan, your interest would be calculated on the $9,500 balance owing on the loan. The amount of interest you pay changes as the balance of your loan changes.

You would pay a reduced amount of $2.08 interest per day.

= $9,500 x (.08/365) x 1

= $2.08 per day

You would save 11 cents a day. Over 30 days, you would save $3.30.

**How is interest charged to the loan? **

Interest is charged each month on the anniversary of the loan. The interest is added to the loan balance.