New Jersey Administrative Code
Title 3 - BANKING
Chapter 1 - GENERAL PROVISIONS
Subchapter 14 - REVOLVING CREDIT EQUITY LOANS
Section 3:1-14.6 - Methods of computing interest
Universal Citation: NJ Admin Code 3:1-14.6
Current through Register Vol. 56, No. 18, September 16, 2024
(a) Interest may be computed in each billing cycle by any of the following methods, in accordance with the agreement between the bank, savings bank or savings and loan association and the borrower.
1. By converting
each yearly rate to a daily rate and multiplying such daily rate by the
applicable portion of the daily unpaid principal balance of the account, in
which case each daily rate is determined by dividing each yearly rate by 365;
or
2. By multiplying 1/12th of each
yearly rate by the applicable portion of the average daily unpaid principal
balance of the account in the billing cycle, in which case the average daily
unpaid principal balance is the sum of the amount unpaid each day during the
cycle divided by the number of days in the cycles; or
3. By converting each yearly rate to a daily
rate and multiplying such daily rate by the number of days in the billing cycle
and then multiplying by the applicable portion of the average daily unpaid
principal balance of the account in the billing cycle, in which case each daily
rate is determined by dividing each yearly rate by 365, and the average daily
unpaid principal balance is the sum of the amount unpaid each day during the
cycle divided by the number of days in the cycle.
(b) For all the methods of computation in (a)1-3 above, the billing cycle shall be monthly (except that a month may vary from 27 to 35 days) and the unpaid principal balance on any day shall be determined by addition to any balance unpaid as of the beginning of that day all advances, past due interest, and other permissible amounts charged to the borrower and deducting all payments and other credits made or received that day.
Disclaimer: These regulations may not be the most recent version. New Jersey may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
