US 2013/0254084 A1Published application

System and method for effective interest rate calculation

OwnerE. Keith Darrowinventor

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Abstract

Systems and methods can quickly and easily compute an effective interest-rate calculation, such as an annual-percentage rate (APR), offered in connection with a credit-card balance-transfer promotion. The systems and methods fully automate the process, allowing a consumer to instantly solve an effective rate on a credit card balance transfer offer with no special knowledge or skills. The process can work with all or some of the variables, in any order. The consumer can use the tool to see how the variables of the offer alter the effective annual effective percentage rate, enabling the consumer to better shop and compare credit card balance transfer offers.

Claims10

Dependent claims

A method for calculating an effective interest rate for a loan, the method comprising:

inputting discount percentage, loan rate, loan amount, loan begin date and loan end date into a computing device;
computing, with the computing device, an amount to pay back, A, by the following formula:
A
=
Loan


Amount
*
(
1
+
APR
365
)
Duration


of


Loan


i


n


Days
computing, with the computing device, an amount borrowed after a deduction of a discount, B, by the following formula:
B=Loan Amount−(Loan Amount*Points)
computing the effective interest rate, i, by the following formula:
i
=
365
*
[
log
[
Loan


Amount
*
(
1
+
APR
365
)
Duration


of


Loan


i


n


Days
Loan


Amount
-
(
Loan


Amount
*
Points
)
]
10
Duration


of


Loan


i


n


Days
-
1
]
,
wherein the above formulas are specifically coded on the computing device so that A, B and i behave like fixed-point calculations.

101 more elements

Dependencies are inferred from the claim text.