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Add on interest |
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Add on InterestA method of charging interest usually used in the financing of automobiles, but not generally used in real estate financing. Interest is computed on the total amount borrowed and added on to the principal. Each payment is then deducted from this total amount. Interest on real estate loans is usually figured based on the balance owing after each payment is made (declining balance).Add on interestThe interest a borrower pays on the principal for the duration of the loan.Add on interest Similar MatchesInterest coverInterest coverInterest cover measures the amount of interest paid by a company on its borrowings against its operating profit in the same period.The ratio shows the impact of gearing on a company's profit and loss account. If the figure is low, a small reduction in operating profits, or a rise in the cost of borrowing, can wipe out pre-tax profits. To calculate interest cover, divide the operating profits by the interest paid.Example: a company which has profits of £4m and which pays net interest of £1m, has interest cover of 4. Amortizing interest rate swapAmortizing interest rate swapSwap in which the principal or notional amount rises (falls) as interest rates rise (decline). High withholding tax interest incomeHigh withholding tax interest incomeInterest income that is subject to a foreign gross withholding tax of 5% or more. Specified in US tax code. Variable interest rateVariable interest rateSee: Adjustable rate Capitalized interestCapitalized interestInterest that is not immediately expensed, but rather is considered as an asset and is then amortized through the income statement over time. Further SuggestionsCovered interest parityInterest parity Short term interest rates Covered interest arbitrage Interest in Arrears Earnings before interest, taxes, depreciation, and amortization (EBITDA) Any interest date Cash flow after interest and taxes interest rate swap Interest rate Matured noninterest bearing debt interest payable open interest Interest sensitive stock Discount Interest Interest rate ceiling interest rate Interim interest bond interest yield Lessees Interest stepped interest debenture stocks Exact interest Interest Cap Interest only mortgages Interest only loan |
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