A simple interest loan doesn’t charge you additional interest on your accrued interest. In other words, the only interest you pay is on the outstanding principal balance of your loan. Auto loans and ...

Discover how simple interest benefits borrowers in car loans and consumer purchases, and learn why it might not be ideal for investors seeking compounded returns.

Lenders calculate how much interest you’ll pay with each payment in two main ways: simple or on an amortization schedule. Short-term loans often have simple interest. Larger loans, like mortgages, ...