Look beyond the monthly repayment
A smaller repayment can mean more time and a larger total cost.
The main idea
Compare loans using the same amount of principal. Record the interest rate, number of payments, upfront fee and any final payment. Check whether compulsory insurance or linked services add costs not represented in the fields.
Prepare your inputs
The nominal total adds all repayments and entered upfront fees. A smaller monthly payment is easier on a monthly budget, but it may continue for longer. Always inspect both the repayment and the total.
A worked example
At zero interest, €12,000 repaid in 24 payments of €500 plus a €240 fee totals €12,240. Thirty payments of €400 plus a €600 fee totals €12,600: the smaller payment costs more overall.
How the model works
The comparison assumes fixed nominal rates, equal monthly repayments and fees paid upfront rather than financed. A variable rate, balloon payment or additional product can make the actual offer different.
What to watch for
Total nominal euros and annual percentage rate answer different questions. The two-loan comparison does not calculate APR. Check the contractual APR and its included costs in the lender’s documents.
Review your decision
Use the repayment to assess the monthly commitment and the total to compare the euros paid. With different terms, timing also matters. Review early-repayment terms and keep a record of the actual offer rather than relying on a simulation alone.