Can simple interest be calculated semi annually

[Miker]

Hi, I have an interesting dilemma I need help with.
I have a contract that has a clause to charge 15% annual interest calculated semi annually.
The catch here is that it should not compound.
Can this be done? if yes how would this be done.
There is no set time to repay.
Thank you

 

[JeffM]

Hi, I have an interesting dilemma I need help with.
I have a contract that has a clause to charge 15% annual interest calculated semi annually.
The catch here is that it should not compound.
Can this be done? if yes how would this be done.
There is no set time to repay.
Thank you

If that is what the contract says, then interest is calculated on the principal balance at the start of the year at 7.5%, and presumably is added to principal at the end of the year.

That is extremely odd because there is little point to it unless it is a way to calculate interest due on a payoff. I am not going to give legal advice, but what is the exact legal language.

 

[tkhunny]

Or is it a loan and you must pay the 7.5% semi-annually so the balance remains unchanged?