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#1056034 - 10/01/08 10:24 PM Verify APR
dollars & sense Offline
Gold Star
Joined: Oct 2006
Posts: 344
I am trying to verify that the APR is correct on daily simple interest loans (small consumer loans). What do you use?

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Lending Compliance
#1056045 - 10/01/08 10:29 PM Re: Verify APR dollars & sense
Ray_ Offline
Platinum Poster
Joined: Aug 2006
Posts: 879
Dallas, TX

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#1056100 - 10/02/08 01:34 AM Re: Verify APR dollars & sense
Richard Insley Online
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Richard Insley
Joined: Oct 2000
Posts: 10,179
Toano, VA
First, you verify the Amount Financed and payment schedule. If there are any fees, be sure the ones that are FCs were properly deducted from the principal to arrive at the AF. The payment schedule can be verified by amortization--but you must amortize by the US Rule method if that's how your note reads and the loans are serviced. If the ending balance is anything other than $0.00, then the disclosed payment schedule is wrong.

After determining that you are entering clean information, you can use APRWIN to generate an APR by the actuarial method. If the recalculated APR is within tolerance, you're done.
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