How to compare loans without looking only at the monthly payment
A practical guide to understanding total cost, term and conditions before choosing a loan.
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Learn to make better decisions
Guides to comparing loans
Learn to compare personal loans using the same amount and term, interpret nominal rate, APR, payment and total cost, and recognise when a low payment depends on an excessively long repayment period.
What this section covers
Loan guides separate payment, cost and flexibility so an attractive figure does not hide a long term, fee or linked product. Examples use comparable scenarios and identify which details need confirmation in pre-contract information.
Use the calculator with the same amount and term, test the payment against a conservative budget and keep dated copies of the terms. Treat missing information as pending, never as a zero cost.
- Like-for-like offer and pre-contract information comparison.
- Effects of term, fees and early repayment.
- Testing the payment within a complete household budget.
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