What is the difference between the credit rate from the loan overpayment?

Before stopping in a choice on a particular loan product, the borrower must be monitored by all banking proposals.

Credit is the receipt of cash under interest established by the financial organization. It is the interest rate of borrowers that consider the basic characteristic of credit obligations. In fact, all borrowers are interested only in one thing — which will be the difference between the original sum and the final, that is, the overpayment.

The interest rate on the loan offer is a sum of money that is expressed as a percentage of the «body» of the loan. It is paid during the use of borrowed means, most often such a period is 1 year.

It is this figure that is prescribed in a loan agreement as a percentage, and it is believed that what it is below, the more profitable loan. In principle, this is, if in addition not to take insurance and possible commissions.

The maximum interest rate establishes the Central Bank of Russia, so financial institutions cannot establish high interest without any reason. In order to purchase a loan product on favorable terms, it is necessary to track loan offers from different financial organizations.

Overpayment on the loan is the cash that the borrower is obliged to pay the lender over borrowed. This amount includes interest, commission, insurance and other payments provided for by the loan agreement. Overpayment with early repayment — decreases.

Experts argue that overpayment on the loan agreement is analogous to the full cost of the loan in money.

The loan amount is 150 thousand rubles for a percentage rate of 12% per annum, for a period of 1 year. Annuity payment. The borrower did not produce additional payments.

Then, at the interest rate of 12%, the final amount on the loan will be 168 thousand rubles, where the loan overpayment will be 18 thousand rubles. However, it is impossible with absolute accuracy, to say that in the end the amount will be just such. Since the profitability of the loan must be assessed comprehensively. The contract may be spelled out such additional parameters as commissions and other additional payments. It must be borne in mind that the interest rate does not include commissions, or other additional payments. For example, in a loan agreement, it is mentioned that the lender charges a commission of 1000 rubles, respectively, with each delay, the total loan amount will change with each delay.

We hope this information was helpful to you. Now you understand where the interest rate and overpayment of the loan is taken.