You are applying for a loan There are many things that you should consider, but one of the most important is the APR, which is the real annual interest rate, the APY allows you to quickly calculate the total cost of the loan. know before applying.
What is APR?
One of the most important indicators helpful in assessing whether a given loan is granted on favorable terms is the APRC. Pursuant to the provisions on consumer credit, information on the APRC (actual annual interest rate) is obligatory for almost every loan or loan irrespective of whether it is provided by the bank, credit unions or non-bank loan companies .
By definition, this indicator informs about the total cost associated with a loan or loan that is borne by the client. The APRC is expressed as a percentage of the total loan amount, which is calculated on an annual basis.
Thus, the RRSO indicator allows us to transparently and simply compare different loan and loan offers. The APR covers all costs related to the loan, such as interest, commission, home service costs, insurance, application fees and commissions for granting a loan or a loan. The APRC specifies how much the share in the cost of the loan is an additional cost – the greater the difference between the APR and the nominal interest rate, the higher these additional costs.
The first step – a comparison.
It should be noted that APY is not the only indicator determining the cost of a loan. Nevertheless, it guarantees a simple and quick criterion for selecting offers with the most advantageous total cost. For more certainty, we should carefully check selected offers using the websites of lenders. We find transparent sliders on them with detailed exact cost specification for various loan options. In addition to the APR, let us remember to check how much we will ultimately pay for the money we borrow. It is also worth checking what costs await us when we have a problem in repayment of debt and we do not pay the loan on time.
Taking a few minutes to check the offer, we can be sure that we have chosen the best solution.