If a lender uses the simple interest method, it’s easy to calculate loan interest. You will need your principal loan amount, interest rate and loan term to calculate the overall interest costs.

To calculate the principal and interest, multiply the principal amount by the interest rate and multiply the result by the number of years in the loan.

To calculate how much you'll pay in simple interest, multiply the principal (P) by the interest rate (R) by the time period in years (T), then divide that number by 100.

How Simple Interest Works: An Example Suppose you take out a $5,000 loan at 6% interest for two years. To calculate the amount of interest you will pay, use the simple interest formula above.

To calculate interest, you need to know variables such as interest rate, principal loan amount and loan term. So if you had 4% interest on a $100,000 mortgage loan, and your loan term was 30 years ...

How to Calculate Simple Interest. Simple interest is used when a company borrows money for a loan. Usually this amount will be on a monthly basis. The formula for simple interest is principal ...

Learn how to calculate the Simple Interest in Excel either for a single entry or a range or entries, between two dates, using this forumula.

With a simple interest loan, interest is based only on principal, and you can easily calculate it to find out the true cost of borrowing.

According to The Motley Fool, simple interest is earned only on the principal balance, or the amount of money you added to the bank account.

How does a simple interest loan work? With a simple interest loan, it’s easy to calculate how much interest you will pay. All you need to know is the principal amount — the original amount you ...