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Rule of 78 Calculator

See how a precomputed finance charge is weighted toward earlier payments and estimate the unearned interest remaining after a selected payment.

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The sample values are calculated automatically. Enter your own information for a new estimate.

These calculators provide mathematical estimates for education and planning. Loan agreements, lender practices, fees, taxes, payment dates, and rounding can change actual results.

How the calculation works

Rule of 78 Calculator explained

The Rule of 78 is a precomputed-interest method. The digits from 1 through the number of payments are added, then the finance charge is assigned using descending weights.

For a 12-payment loan, the sum of the digits is 78. Payment 1 receives a weight of 12/78, payment 2 receives 11/78, and the final payment receives 1/78.

Because more interest is assigned early, an early payoff can leave less interest to rebate than a simple actuarial schedule would.

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Frequently asked questions

Is the Rule of 78 the same as simple interest?

No. Simple interest is calculated on the outstanding principal over time. The Rule of 78 allocates a finance charge that was computed in advance.

Is the calculator an official payoff quote?

No. It estimates the mathematical rebate and payoff. The lender may include payoff-day interest, fees, or contract-specific adjustments.

Why is more interest assigned to early payments?

The descending weights are largest at the beginning of the schedule, so the early payments receive a larger share of the total finance charge.