“Simple Interest” vs. “Regular Amortizing” (daily vs. monthly) Seller Financing

[TaoWanderer]

What is the name of your state (only U.S. law)? CA

Looks like there are 2 main ways to calculate interest on a mortgage, the so called “Simple Interest” method in which interest is calculated on a daily basis vs. “Regular Amortizing” in which interest is calculated on a monthly basis.
Here's an explanation of the difference: http://www.mtgprofessor.com/a%20-%20amortization/how_does_simple_interest_work.htm

On a seller financed mortgage are you allowed to chose which method you use to calculate the interest, if it doesn't mention it one way or the other in the contract?

From my research it sounds like the monthly interest method is the more common method, so if that's the default would it have to be in the contract to use the less common daily method?

Thank you.

 

[tranquility]

The "default" is simple interest.

 

[TaoWanderer]

The "default" is simple interest.

By simple interest do you mean the daily method vs monthly or simple interest vs compound interest.

From what I've read the monthly method is the default, but both are simple in the terms of simple vs. compound.