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#508246 - 03/06/06 02:47 AM Actual/360 Accrual Method v. Actual/365
vaca Offline
Junior Member
vaca
Joined: Jun 2002
Posts: 37
Does anyone know the citation for using 360 on Commercial Loans and 365 on Consumer Loans? Thank You.

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Lending Compliance
#508247 - 03/06/06 12:08 PM Re: Actual/360 Accrual Method v. Actual/365
Rocky P Offline
Power Poster
Joined: Jun 2003
Posts: 7,659
Florida
IMHO, no federal citation, mostly a bank preference. In the past (B.C. as before computers) many of the commercial notes were for 90 days. That was 1/4 of the annual interest [90/360]. It was easier to calculate than counting days and dividing by 365/366. Added benefit a slightly higher rate of return.

For legality, check your state regs.
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#508248 - 03/06/06 04:48 PM Re: Actual/360 Accrual Method v. Actual/365
Dream Dancer Offline
Member
Joined: Sep 2005
Posts: 84
Texas
Also check your State law regarding usury.

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