Rule of 78

A formula used to determine rebates on Interest for Installment loans; since 1 + 2 + ... + 12 = 78, 1/78th of the Interest is owed after the first month, 3/78ths after the second month, etc.

Related Terms: 9 Interest, Inc., Installment, Installment loan, Loan, NSTA, Owe, SEC, Term

Other Related Pages: Category: Lending_and_Credit Starting With: R

Additional Related Terms: 12b-1 funds, Allowance for depreciation, Accrual of discount, Accrued interest, After-tax basis, Amortization of premium, At par, All or any part, At best, At call