Posted: 3/31/2010 9:07:54 PM EDT
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Say the total amount owing is $1300
Lets also say you haven't made any payments for 4 years and the APR is 29.99%. How much has that $1300 grown? How do you figure out the fee? |
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$3711.79 owed by my calculations. Can you show me the math so that I may learn how you amortized that out? 29.99% interest a year, so $1,300 x 1.2999 = balance after one year. Take that number and multiply by 1.2999 to figure out the balance at the end of year 2. Do it again for year 3, then again for year 4. I am probably horribly wrong here though. 
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$3711.79 owed by my calculations. Can you show me the math so that I may learn how you amortized that out? 29.99% interest a year, so $1,300 x 1.2999 = balance after one year. Take that number and multiply by 1.2999 to figure out the balance at the end of year 2. Do it again for year 3, then again for year 4. I am probably horribly wrong here though. Oh yeah, thats only compounding the interest anually... I think the CC companies compound the interest daily 
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$3711.79 owed by my calculations. Can you show me the math so that I may learn how you amortized that out? 29.99% interest a year, so $1,300 x 1.2999 = balance after one year. Take that number and multiply by 1.2999 to figure out the balance at the end of year 2. Do it again for year 3, then again for year 4. I am probably horribly wrong here though. Oh yeah, thats only compounding the interest anually... I think the CC companies compound the interest daily Well it gives you a baseline ballpark number if nothing else
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You sure about this - $3711.79?
I have the Amor tables here, but it only goes up to 25.75%, and the amounts increase by 1K. So: $1000 @ 25.75% for 48 months = $1611.84 total amount of the loan. That other number sure seems a long way off from that. I have no idea how to figure it out manually. |
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$3711.79 owed by my calculations. Can you show me the math so that I may learn how you amortized that out? 29.99% interest a year, so $1,300 x 1.2999 = balance after one year. Take that number and multiply by 1.2999 to figure out the balance at the end of year 2. Do it again for year 3, then again for year 4. I am probably horribly wrong here though. Oh yeah, thats only compounding the interest anually... I think the CC companies compound the interest daily I'm pretty sure the amoritization schedules are monthly along with the interest rates. So use the formula a few posts up but divide by 12 for your I. |
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You sure about this - $3711.79? I have the Amor tables here, but it only goes up to 25.75%, and the amounts increase by 1K. So: $1000 @ 25.75% for 48 months = $1611.84 total amount of the loan. That other number sure seems a long way off from that. I have no idea how to figure it out manually. Interest is only applied to your principal. It's not compounding interest like a credit card. |
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You sure about this - $3711.79? I have the Amor tables here, but it only goes up to 25.75%, and the amounts increase by 1K. So: $1000 @ 25.75% for 48 months = $1611.84 total amount of the loan. That other number sure seems a long way off from that. I have no idea how to figure it out manually. Interest is only applied to your principal. It's not compounding interest like a credit card. Holy crap you're right. I'm tired as hell, and completely misread the original post. |
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The 4300 sounds like a good base but do not forget:Late fees (48 x 30(just a guess) = 1440+interest) and the wonderful interest on those, add one a month and do the daily interest rate.
If the credit limit was 2K once you pass that mark add the monthly over limit fee and figure the interest on that every month. Should be good for a grand or so plus interest Annual fees If you don't pay right away add in Collection fees Attorneys fees(yours and theirs) court fees I am guessing that $1300 is going cost at least 6K and 8-10K is not out of the realm of possibility if you get the attorneys involved on the cc side and don't have your own. Unless you score some cool debt forgiveness then you might get it down some. Either way it is probably gonna hurt. |
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Even without the extra penalties for not making payments for a while, this thread makes me feel a lot better about selling off those guns last summer (including my last AR) to be totally credit card free. Of course, if one of those emergencies that everyone says is the only reason they got the card for in the first place, I'm in trouble. But I wouldn't have been able to use the cards for an emergency anyway since they were near their limit.
I can't think of one good thing that came out of having them. I blame myself and not the companies, and I realize this has nothing to do with the thread, but there are days I kick myself for selling my little M4gery and need reassurance that it was the right move. Group hug? 
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You would have to read the fine print for the card agreement. I had one that if you carried a balance, they used the average balance for TWO months in order to calculate the interest. Effectively doubling the interest rate. It was a Home Depot business charge card. Luckily it doesn't fall on me, but I worked for a business that an employee stole the company charge card and went on a shopping spree. Charges were filed and 4 years later, it went to court. He plead guilty and I need to figure out restitution. I was given an amount of $2891.80 (from the collections company) and the guy is balking at that amount. Obviously they stopped adding on interest and fees somewhere down the line as the amount owed is less than the interest accrued. |
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You'll have to find out what the collections company paid for the paper, and when they bought the debt. That is all they are entitled to receive except for normal interest, and the bank that underwrote the card is out of the picture. At some point the debt stopped accruing interest and penalties from the bank.
That would be fair, but who the hell knows what your state's statutes require. |
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The formula you'll need is for interest compounded continuously.
The link has a calculator that shows how the interest owed changes when compounded yearly, quarterly, monthly, daily, and continuously. |
