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


### Answer
The term **actuarial method** is defined in *12 U.S.C. § 1735f* as follows -

> the method of allocating payments made on a debt between the outstanding balance of the obligation and the precomputed finance charge pursuant to which a payment is applied first to the accrued precomputed finance charge and any remainder is subtracted from, or any deficiency is added to, the outstanding balance of the obligation

#### Citation:
  - *12 U.S.C. § 1735f*
  - Heading: **CHAPTER 12-SAVINGS ASSOCIATIONS > SUBCHAPTER V-MISCELLANEOUS**

