Loan quote checklist: interest method, fees and repayments

Ask for the repayment schedule

Collect the amount borrowed, amount actually paid to you, number of repayments, due dates and final payment. An advertised monthly payment without a term does not describe the full borrowing cost. A smaller payment over a longer period can still result in more interest.

Ask whether the final payment differs from the ordinary monthly payment. A balloon payment, grace period or uneven schedule will not fit our equal-monthly-payment calculator. Use the lender's complete schedule for those arrangements instead of trying to force it into the tool.

Identify exactly what the percentage means

Confirm whether interest is calculated on the original amount throughout the loan or on the outstanding balance as it falls. A flat rate, annual nominal reducing-balance rate and APR can describe different things. Do not enter a flat-rate percentage or APR as though it were the calculator's nominal annual reducing-balance rate.

Our estimate assumes a fixed annual nominal reducing-balance rate, divided into twelve monthly periods. It models equal monthly repayments. A variable rate needs a separate assessment of how and when it may change; the tool does not predict future rates.

Separate charges from the principal

Find out whether processing charges are deducted from the money released, added to the loan balance or paid separately. The calculator's fee input is for charges paid separately upfront. Financed or deducted fees change the cash flow and may require a different calculation.

• Processing, administration or arrangement charges
• Required insurance or other compulsory products
• Late-payment and early-repayment conditions
• Any security or guarantee the lender requires

Compare the totals and keep the limitations visible

Use the same principal and term when testing two comparable quotes. Read the estimated monthly repayment alongside total interest, all repayments plus entered fees and cost above principal. Those figures exclude penalties, taxes, financed fees and other charges not represented by your inputs.

Keep the original quote, provider's terms and issue date. Confirm any unclear charge directly with the lender. LagosXchange does not arrange borrowing, assess affordability or eligibility, or recommend which loan to take.