# Loan to a CD? what am I missing?

**URL:** https://forums.speedlife.net/t/loan-to-a-cd-what-am-i-missing/42451
**Category:** NYSpeed Off Topic
**Created:** [January 25, 2008, 6:08pm UTC](https://forums.speedlife.net/t/loan-to-a-cd-what-am-i-missing/42451 "2008-01-25T18:08:21Z")
**Posts on this page:** 1
**Showing post:** 2

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### Author: ![Nikuk](https://yyz2.discourse-cdn.com/flex034/user_avatar/forums.speedlife.net/nikuk/32/7254_2.png) [@Nikuk](https://forums.speedlife.net/u/Nikuk)
#### Post date: [January 25, 2008, 6:12pm UTC](https://forums.speedlife.net/t/loan-to-a-cd-what-am-i-missing/42451/2 "2008-01-25T18:12:50Z")

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you’re not missing anything.

On $1000 principal:

pay $0.12/day interest to the loan.  
earn $0.14/day on the CD, plus compounding.

It works so long as the loan is simple interest (not actuarial), and has no prepayment fee.

Its not uncommon at all.

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