Description
Add reference rate and margin, apply max with supplied floor, and calculate simple interest plus floor increment.
Interest and accrual depend on the rate period, compounding rule and day-count basis. A supplied fraction of a year or coupon period is different from deriving that fraction under a contractual calendar convention.
Add reference rate and margin, apply max with supplied floor, and calculate simple interest plus floor increment.
When to use this tool
Use Loan Rate Floor Reset Slice when you need one interest, accrual or supplied-period calculation.
How to use the tool and how it works
- Enter principal, referenceRate, margin, suppliedFloor, yearFraction. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read unflooredRate, appliedRate, interest, floorIncrement. Use the output convention below.
Require nonnegative principal/yearFraction. Add reference rate and margin, apply max with supplied floor, and calculate simple interest plus floor increment.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| principal | Principal | Required. Finite number; minimum 0. |
| referenceRate | Reference Rate | Required. Finite number. |
| margin | Signed allowance under the subtraction order above. | Required. Finite number. |
| suppliedFloor | Supplied Floor | Required. Finite number. |
| yearFraction | Year Fraction Unit: 1. | Required. Finite number; minimum 0. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| unflooredRate | Unfloored Rate | Required. Finite number. |
| appliedRate | Applied Rate | Required. Finite number. |
| interest | Interest | Required. Finite number. |
| floorIncrement | Floor Increment | Required. Finite number. |
{
"input": {
"principal": 1000,
"referenceRate": 0.01,
"margin": 0.02,
"suppliedFloor": 0.04,
"yearFraction": 0.5
},
"output": {
"unflooredRate": 0.03,
"appliedRate": 0.04,
"interest": 20,
"floorIncrement": 4.999999999999999
}
}Limitations and assumptions
- All rates are fractions on one annual basis. Negative floors/rates are allowed; the tool does not choose contractual reset, benchmark, rounding or lawful terms.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Use the full schedule and applicable agreement for actual charges. State rate units, compounding, calendar basis and rounding policy rather than assuming one universal accrual convention.
References
Similar or alternative tools
- Margin Interest Tier One Slice
Clamp balance into the tier slice and multiply slice by annualRate×fractionOfYear.
- Discount Factor Log Derivative Term
Return exp(-rate×time) or (1+rate)^(-time), and derivative of log discount with respect to rate as -time or -time/(1+rate).