Interest is usually calculated at the end of each day. Then at the end of each month, your lender will add your daily interest charges for each day of the month. This monthly interest amount is normally found on your bank statement. Here is the calculation used to work it out. Firstly, you multiply the balance of the home loan (how much you currently owe) by the interest rate, and then divide it by 365 (the number of days in a year ).