The interest rate your lender gives you isn't the true cost of your mortgage. Learn how to calculate your effective interest ...

If the interest rate is compounded continually, a different rate is used: r = e^i - 1. For this formula, the letter "r" stands for the effective interest rate, "i" represents the stated interest ...

The formula for effective rate can be duplicated quite easily on many financial calculators, ... Without the fee, that monthly payment is $775--with the fee, it is $790. Effective annual rate: 7.48%.

Formula: Effective Annual Rate = (1+(r/n))^n)-1*100. Where . r = nominal return divided by number of times compounding is done in a year . n = number of times compounding is done in a year .

Effective annual rate, on the other hand, is higher because of the effects of compounding. ... Formula, and Examples. Law of Large Numbers: What It Is, How It's Used, and Examples.

Changing the loan amount in the calculator back to $200,000, and trying out a few interest rates, shows that an interest rate of 4.11% would produce that same $968 monthly payment.