APRC is the most important indicator when choosing a loan offer. meanwhile, not everyone knows about this and usually pays attention to the nominal interest rate, what is the mistake. The interest rate is just one of the costs, incurred by the borrower. find out, what is APRC and what determines its value.
Key factor in calculating the cost of a loan
worth knowing, how to calculate APRC, to protect yourself from choosing an unfavorable offer. This is a key factor in calculating the actual cost of the loan..
APRC – this is the annual interest rate, total cost of a loan or loan, carried by the client. The indicator is expressed as a percentage - it is a percentage of the total borrowed funds on an annual basis.
The loan cost consists of the following elements:
- interest, that is, nominal interest;
- loan preparation fee;
- commission for issuing a loan;
- credit insurance.
Nominal interest rates are usually quoted on an annual basis. The training fee is not included in the costs, which always accompany the borrowing - usually it is added, when it comes to mortgages. This is primarily related to the appraisal of the property.
Low nominal interest rates can differ materially from actual costs. For this reason, regardless of the type of commitment, it is recommended to pay attention to APRC.
Maximum APRC - legal regulations
The Consumer Credit Law states, that lenders cannot in any way form a commission for the loan. There are maximum values for the annual interest rate.
APRC interest rate also includes liability costs, which cannot be higher, than 25% of the total loan amount and 30% of the total consumer credit in year.
The purpose of this act is, to eliminate unfair practices of financial institutions. So as not to be deceived, it is worth learning how to calculate APRC. Knowing the formula for APRC, you can calculate all costs and choose the most favorable loan or loan offer.
APRC calculation
Lowest APRC should be accounted for by relevant factors. Low nominal interest rate, symbolic commission and no compulsory insurance, as well as other additional commissions are good forecasts of loan profitability. It is usually best to take a long-term commitment from a bank., than short-term - in a non-bank institution.
Non-banking institutions, wishing to attract customers, offered by APRC 0% for the first loan. A refund within a specified period is equivalent to a refund of the exact amount, which was borrowed. Zero APRC offers are for small amounts - usually you can't get more 3000 hryvnia.
APRC, as mentioned, is of great importance regardless of the type and value of the obligation, but when you, eg, want to apply for mortgage, you need to pay special attention to the APRC mortgage due to the high amount of the loan itself, without interest and other costs.
Calculating APRC using a formula takes a long time, especially when it is necessary to check several sentences. In this situation, it is worth focusing on comfort and convenience., используя механизм сравнения онлайн. Извлеченные значения APRC можно сразу сравнить, и четко видно, какое предложение наиболее выгодно. In this way, вы можете рассчитать APRC кредита. The method for calculating the value of the indicator is determined by the Law on Consumer Lending.
To compute, based on the APRC calculation formula, were correct, need to know the corresponding numbers. The data in the template should be filled in as follows:
- K - number of the next loan payment,
- TO '- number of the next loan repayment in installments,
- A K - the paid amount of the loan,
- A K ” - loan repayment amount,
- m - number of the last loan payment,
- m - number of the last installment of the payment,
- t K – период между первым днем платежа и датой платежа с номером K,
- t K – период между датой первого платежа и датой погашения с номером K ,
- и – фактическая годовая процентная ставка.
The APRC is calculated using the formula presented for all loans and borrowings.
