1. What is the normal range of annualized rate?

The maximum interest rate that a bank can stipulate cannot exceed 24%, so if the annualized interest rate does not exceed 24%, it is considered to be within the scope of normal legal support. According to Article 26 of the Supreme People's Provisions on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases: If the interest rate agreed between the borrower and the borrower does not exceed 24% of the annual interest rate, and the lender requests the borrower to pay interest at the agreed interest rate, the People's should be supported. 1. Conversion of interest rates. The conversion relationship between annual interest rate, monthly interest rate and daily interest rate is: annual interest rate = monthly interest rate × 12 (month) = daily interest rate × 360 (days) monthly interest rate = annual interest rate ÷ 12 (month) = Daily interest rate × 30 (days) Daily interest rate = Annual interest rate ÷ 360 (days) = Monthly interest rate ÷ 30 (days): 1. Annualized rate definition Annualized rate of return refers to the rate of return obtained with an investment period of one year. Annualized rate of return = [(investment income/principal)/number of investment days] 365 × 100% annualized return = principal × annualized rate of return Actual income = principal × annualized rate of return × number of investment days/3652. Difference The annual rate of return is the rate of actual return on an investment in one year. The annualized rate of return is the income of an investment (commonly used in monetary funds) over a period of time (such as 7 days). Assuming that it remains at this level for a year, it is the converted annual rate of return. Because the annualized rate of return changes, the annual rate of return is not necessarily the same as the annualized rate of return. 3. Factors affecting annual interest rates 1) Central Bank’s policy Generally speaking, when the central bank expands the money supply, the total supply of loanable funds will increase, supply exceeds demand, and the natural interest rate will decrease accordingly; conversely, the central bank implements a tightening Monetary policy reduces the money supply, the supply of loanable funds exceeds demand, and interest rates will rise accordingly. 2) The price level market interest rate is the sum of the real interest rate and the inflation rate. When the price level rises, market interest rates rise accordingly, otherwise real interest rates may be negative. At the same time, due to rising prices, the public's willingness to deposit will decrease while the loan demand of industrial and commercial enterprises will increase. The imbalance between deposits and loans caused by loan demand being greater than loan supply will inevitably lead to an increase in interest rates. 3) Stock and bond markets If the securities market is in a rising period, market interest rates will rise; conversely, interest rates will also decrease relatively speaking. 4) International economic situation Changes in a country’s economic parameters, especially changes in exchange rates and interest rates, will also affect the fluctuations in interest rates in other countries. Naturally, the rise and fall of the international securities market will also create risks for the interest rates faced by international banking business. 4. Definition of monthly interest rate The monthly interest announced by banks is basically expressed in terms of one year. For example, the annualized deposit interest rate for three months is 2.6% (listed by the bank). In fact, it is actually calculated as three months. The current actual rate of return per month is only 0.65%. The annual interest rate is generally expressed in % (percent), and the monthly interest rate is generally expressed in ‰ (thousandths); the daily interest rate is expressed in ten thousandths of the principal, usually called daily interest. For a few centimeters or centimeters. For example, if the daily interest rate is 1%, that is, the principal is 1 yuan, the daily interest rate is 0.001 yuan. (1 centimeter = 0.001 yuan, one cent = 0.0001 yuan) Calculation formula: daily interest rate_annual interest rate ÷360 = monthly interest rate ÷305. The relationship between annual interest rate and monthly interest rate: monthly interest rate = annual interest rate / 12, year Interest rate = monthly interest rate 12. For example, if the annual interest rate is 7.05%, converted into a monthly interest rate, it is 7.05%/12=5.875‰ (Generally, banks use monthly interest rates to express interest rates in mortgage contracts).

2. How to calculate the annual interest rate of a loan

Free viewing of paid content for a limited time

Answer

Annual interest rate calculation formula: monthly interest rate ×12 months = daily interest rate × 360 days (calculated as 360 days per year) = annual interest rate. Calculated based on the daily interest rate of 0.05%, the annualized interest rate = 0.05% × 360 days = 18%. For a loan of 10,000 yuan, the interest for one year is 18% annual interest rate × 10,000 yuan = 1,800 yuan.

3. What is the annual interest rate of 3.75% and how is it calculated?

The annual interest rate of 3.75% is the annual interest rate of 3.75%. This interest rate is 3 yuan per dollar per year. The interest is 3 yuan, 7 cents and 5 cents. The annual interest per thousand yuan is 37 yuan and 5 cents, and so on. .

1. The annualized interest rate refers to the interest rate discounted to the whole year through the inherent rate of return of the product. On March 31, 2021, the People's Bank of China issued an announcement to make relevant regulations on the annual interest rate of loans for loan products. All institutions engaged in loan business should clearly display the annual interest rate to borrowers on their websites and mobile applications.

Institutions engaged in loan business include but are not limited to depository financial institutions, automobile finance companies, consumer finance companies, companies, and Internet platforms that provide advertising or display platforms for loan business, etc.

2. The annual interest rate of the loan shall be calculated based on the proportion of the occupied loan principal charged to the borrower and converted into an annualized form. If the compound interest calculation method is included in the annual interest rate of the loan, it should be stated that it is simple interest.

3. Interest rate refers to the ratio of the amount of interest to the amount of borrowed funds (principal) within a certain period of time. Interest rate is the main factor that determines the cost of an enterprise's capital. It is also a decisive factor in enterprise financing and investment. Research on the financial environment must pay attention to the current interest rate situation and its changing trend. The amount of interest due in each period (called the total principal amount) Ratio of amount to face value. The total interest on the amount lent or borrowed depends on the total principal amount, the interest rate, the frequency of compounding, and the length of time it is lent, deposited, or borrowed. Interest rate is the price a borrower pays and the return the lender earns from lending to the borrower by deferring his or her consumption. The interest rate is usually calculated as a percentage of the one-year interest to the principal.

4. In the modern economy, interest rates are restricted by many factors in economic society and have a significant impact on the entire economy. The interest rate determination theory has also experienced classical interest rate theory, Keynesian interest rate theory, loanable funds interest rate theory, IS -LM interest rate analysis and the evolution and development process of contemporary dynamic interest rate models.

4. What is the annual interest rate that is considered low interest rate?

An annualized interest rate of less than 3.8% is considered low

In fact, the key to determining the annualized interest rate of a loan lies in the nature of the lending institution, that is, whether it is a private lending institution or a bank or licensed financial institution. .

1. Private lending institutions: The legal red line for private lending interest rates is 4 times the LPR for the same period. Based on the one-year LPR of 3.8%, that is, it does not exceed 15.2%.

2. Banks and licensed financial institutions: They are not considered private lending institutions. The annual interest rate is still calculated according to the previous two-tier and three-zone areas, that is, the annual interest rate is 24% and the annual interest rate is 36%. Among them, the annual interest rate of 24% is protected by law, and the annual interest rate of 36% is protected by law.