Precompute(redirected from Pre-Computes)
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To calculate the annual interest owed on a loan by either deducting the annual interest from the face amount of the loan, or adding the compound interest together and dividing it out equally over 12 monthly periods. This means that the effective interest paid will be higher than the stated amount on the loan. Because of this, most jurisdictions require lending institutions using precomputation to express the interest rate in simple interest terms.