1. What is Daily Mortgage Interest?

Daily mortgage interest is the amount of interest that accrues on your mortgage loan each day. Most mortgages use simple daily interest, meaning interest is calculated daily based on the current loan balance.

2. How Does the Calculator Work?

The calculator uses the daily interest formula:

Where:

• Balance — Current mortgage principal balance
• Annual Interest Rate — Your mortgage's annual interest rate (as a percentage)
• 365 — Number of days in a year (some calculations use 360 days)

Explanation: The formula calculates what portion of your annual interest accrues each day based on your current balance.

3. Importance of Daily Interest Calculation

Details: Understanding daily interest helps borrowers see how much of their payment goes toward interest vs. principal, and how extra payments can reduce total interest paid over the life of the loan.

4. Using the Calculator

Tips: Enter your current mortgage balance and annual interest rate. The calculator will show how much interest accrues daily. Multiply by 30 for a monthly estimate.

5. Frequently Asked Questions (FAQ)

Q1: Why calculate daily interest?
A: It helps you understand how interest accrues between payments and the impact of making extra payments.

Q2: Does this account for compounding?
A: Most mortgages use simple interest, but some loans compound daily - check your loan terms.

Q3: Should I use 365 or 360 days?
A: Most mortgages use 365 days, but some commercial loans use 360. Check your loan documents.

Q4: How does this relate to my monthly payment?
A: Your payment first covers accrued interest, then reduces principal. Early in the loan, most of your payment goes to interest.

Q5: How can I reduce daily interest?
A: Making extra principal payments reduces your balance, which directly reduces daily interest accrual.