Why the credit under 9,99% per annum leaves from 60% an overpayment in a year?
At last after crisis many banks actively hit to the sphere of consumer crediting by cash, that is granting the monetary credits to the population. But if before crisis these credits were distributed practically under zero percent, then now the overpayment on such credits reaches 60% though in advertizing 9 - 12% per annum are specified. And the people trust similar advertizing and do not consider a pure overpayment at all. I will tell you what percent and overpayments are put in the credit and why it leaves too expensive.
So, we will pass to business. As the former bank worker I can describe in detail the principles of charge of percent in bank. In the credit there are several different percent which differ with a charge method. The main of them: percent for granting the credit (the one-time commission), an insurance, annual percent and the monthly commission. Also there are penalties and a penalty fee, but it only for fans to delay the next payment.
And now about everything one after another. The percent undertakes granting the credit directly before granting the credit and is subtracted from the loan sum. For example, if you want to take 10000 den. unit, at the one-time commission for granting the credit of 5% you receive on hands only 9500 den. the unit
one after another goes Further an insurance which pays off for all term of crediting and is added to the credit sum. For an example we take the same credit in 10000 den. piece. The standard size of an insurance of about 1% a month, but there are also other rates. If we take the credit for 24 months, then the general size of an insurance will make:
10000 den. unit * 1% * 24 months = 2400 den. the unit
This sum of an insurance is not subtracted, and added to the credit sum, thus, you will sign the contract not on 10000 den any more. unit, and on 12400 den. piece.
We will talk about the monthly commission further, or in other words this commission is called credit service charges. The usual size of such commission is 2 - 3%. It is charged monthly for the total amount of the credit, that is on 12400. For calculations we will take an average value of the commission in 2,5%.
12 400 den. unit * 2,5% = 310 den. This commission you will monthly overpay unit
. And at early repayment you, of course, will save it.
Well and the last payment is an annual percent or an interest rate. This payment is charged on the current rest on a credit body, that is every month it will decrease. At early repayment you pay annual percent too only for those months which actually possessed the credit.
Independently it is very difficult to carry out calculation of an overpayment on annual percent because every month it will decrease. But we will calculate it for the first month, and then we will reduce twice and we will increase on the number of months.
12400 den. unit * (9,99% / 12 months) / 2 = 51,66 den. unit
And now we will count the sum of all payments on the credit. The credit sum under the contract will be 12400 den. unit, monthly commission 310 den. the unit * will make 24 months 7440 den. piece. An overpayment on annual percent 51,66 den. the piece * will make 24 months 1240 den. All this we summarize unit
and we receive 21 080 den. piece. We remember that on hands we receive only 9500 and we consider percent of a pure overpayment 21080 - 9500=11580 den. piece. Now we divide this sum on 9500 and we receive 122% in two years, that is 61% a year. Here such cheerful calculations turn out. Monthly payment on this credit will make:
21080 den. unit / 24 months = 878,33 den. the unit
Here so - that the credit under 9,99% per annum is obtained from 60% of an overpayment a year.
In conclusion I want to tell that if you decided to take nevertheless the credit in bank, then never you look at annual percent which is specified in advertizing. Ring out several banks, call by it the sum of the desirable credit and term for which you want to take a loan, and ask to calculate to you monthly payments. Write down all this, and then compare also consider the total amount of payments to recognize an overpayment by the credit.