Some Cheap Loans in the Philippines Are Not Really Cheap

When comparing loans in the Philippines, don’t depend only on the interest rate published.  Some loans advertised as cheap loans are not really cheap.

And the reason is that the total interest for the whole term of the loan is deducted immediately. Hindi mo makukuha yong total loan amount na inaplayan mo.

Example itong nakita kong loan na ang collateral ay motor vehicle. Hindi na nila kukunin yong sasakyan mo, pero you need to give a copy of your OR and CR.

Ang loan amount is 10,000 pesos at ang interest rate ay 2 percent a month lang daw. Ang galing, di ba? Iisipin natin, cheap loan, 200 pesos lang a month ang interest, at kung hihiramin natin ang pera for one year, 2,400 ang total interest natin.

But it’s not.  With this company, if you borrow 10,000 pesos for one year, you will get only 7,994 pesos and then you pay 1,034 a month for 12 months.
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If we compute, in one year, we’ll be paying a total of 12,408 pesos. Pag i-compare mo sa 10,000 loan amount, 2,408 yong total interest, pero kung i-compare mo sa 7,994 na nakuha mo, ang total interest ay 4,414 pesos — almost half ng loan amount at more than half ng nakuha mo!

Sa 50,000 pesos na loan amount, 44,090 ang makukuha mo, at ang monthly payment mo for 12 months ay 5,167. Kung i-compare mo sa loan amount na 50k, ang total interest na maibabayad mo after 12 months ay 12,004 pesos — pero,kung i-compare mo sa pera na nakuha mo, ang total interest ay 17,914 pesos!

We could say that most lenders advertised cheap loans which aren’t really cheap, but there are loans where the interest is not deducted immediately.

Low Interest Personal Loans in the Philippines

8 Comments

  1. Nora January 17, 2018
  2. mj January 16, 2018
  3. Reu S. Vargas January 6, 2018
  4. Reu S. Vargas January 6, 2018
  5. Nora October 10, 2014
  6. Rolyn October 9, 2014
  7. Nors August 15, 2013
  8. rayman August 12, 2013

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