The Motley Fool Discussion Boards
Financial Planning / Tax Strategies
|Subject: Re: private loan - details, details...||Date: 8/5/2004 4:59 PM|
|Author: Wradical||Number: 72739 of 121061|
(Lorenzo)Ok, I do have a problem - I don't yet understand the damn tables displayed in the monthly letter, an example of which can be seen here:
The various percentages are the Applicable Federal Rates (AFRs), which are supposedly derived from prevailing rates on US Treasury securities.
The different columns are for how often your payments are scheduled. (Annual semi, quarterly, monthly.)
For the issue at hand, you only care about the first item in each category - AFR. The 110/120/130% rows are for other provisions in the Internal Revenue Code that require interest rate updates.
Short-term means a demand note, or one up to 3 years.
Mid-Term means 3-9 years.
Long-term means over 9 years.
Does that help?
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