Loan

[simon]

£3,000 loan

over 2 years at 6% interest

To calculate the interest do i

A) Add 6% on to £3,000 ? = £3,180

Add 12% (6% for year 1 and 6% for year 2) on to £3,000 which = £3,360


Thank you

DevCoder

Probably neither, unless its a "simple" interest loan
If the repayments are monthly then

Monthly payment : 132.96
Total charge : 191.08
Total repayment : 3,191.08

[simon]

My question is, How do I Calculate the interest.

I have no idea where you got the numbers from...

John1993_2

[simon] wrote: »

My question is, How do I Calculate the interest.

I have no idea where you got the numbers from...

It depends on how you want the interest to be calculated. Saying "6% interest" isn't enough to give a definite answer, as the calculation will depend on whether it's flat, APR, daily, continuously compounded, actual / 365, 30 / 360, or any of a vast number of other ways in which an interest rate can be quoted.

If you want to say it's a flat rate, however (such as is often quoted on car finance), then it's 6% * 2 (years) * £3,000

= £360

So, the important question is this, on what basis is the 6% quoted?

imoneyop

[simon] wrote: »

My question is, How do I Calculate the interest.

I have no idea where you got the numbers from...

That depends on what the 6% is - is it a flat rate or an APR?

[simon]

It is currently set at a fixed rate of interest – 6% nominal.

the repayment period

You are required to pay back the loan within 1-5 years. The exact term will be agreed with your Delivery Partner as part of your application process. Capital repayment holidays are available, but interest must be covered monthly throughout the loan term.

John1993_2

[simon] wrote: »

It is currently set at a fixed rate of interest – 6% nominal.

No, not is it fixed or floating, but on what basis is it charged?

Just quoting "6%" is not enough to have anyone give you a definite answer; "6%" means diffferent things, dependent on what basis it's being quoted.