### Question
How is the term actuarial method defined?


### Answer
The term **actuarial method** is defined in *15 U.S.C. § 1615* as the following:

> the method of allocating payments made on a debt between the amount financed and the finance charge pursuant to which a payment is applied first to the accumulated finance charge and any remainder is subtracted from, or any deficiency is added to, the unpaid balance of the amount financed

#### Citation:
  - *15 U.S.C. § 1615*
  - Heading: **CHAPTER 41-CONSUMER CREDIT PROTECTION > SUBCHAPTER I-CONSUMER CREDIT COST DISCLOSURE > Part A-General Provisions**

