How do I read the cost figures on a loan offer?

2 min read

Several figuresRate, APR, fees, total

Total repayable rulesThe real cost

Check what's includedFees in or out?

Read the terms tooERC, rate type

The figures you'll see

A loan offer typically shows an interest rate, sometimes an APR, a list of fees, a monthly payment, and — if you ask — a total amount repayable. These are not interchangeable. The rate describes the cost of the balance; the APR annualises rate-plus-fees; the monthly payment tells you affordability; the total repayable tells you the actual cost. Knowing which is which stops you comparing the wrong numbers. See flat rate vs APR.

The figure that matters most

For deciding what a loan really costs, the total amount repayable, with every fee included, is the one to anchor on. It captures the rate, the fee structure and the term in a single number you can compare across offers. If an offer does not show it, ask — and check whether the figure you're given includes all fees or just interest. A total that excludes fees flatters the deal.

Reading beyond the numbers

The cost figures don't capture everything. Check the terms behind them: is the rate fixed or variable? Is there an early repayment charge? A personal guarantee? These shape whether a given total is right for you. Read the whole offer, not just the headline figure. See hidden costs to watch.

Put each offer's total repayable side by side on the true cost calculator, and for a clear, itemised offer, apply to Credicorp.

Frequently asked questions

Which figure on a loan offer tells me the real cost?

The total amount repayable with all fees included — it captures the rate, the fees and the term in one number you can compare across offers. The interest rate alone, or a total that excludes fees, can mislead. If the offer doesn't state a fully-loaded total repayable, ask for it, and confirm exactly which charges are included before you compare.

What's the difference between the interest rate and the APR on my offer?

The interest rate is the cost applied to your balance; the APR annualises the rate together with mandatory fees, giving a fuller picture of the yearly cost — useful for comparing similarly-structured loans. Neither is the same as the total repayable, which is the actual pounds you'll pay. Use the APR to compare like-structured offers, but anchor your decision on the fully-loaded total repayable.