ming yung asked 6 years ago
example : 12 months @4.88%p.a, equivalent to effective rate of 8.99%p.a . what does it means ? what is different between 4.88% p.a and 8.99%p.a
1 Answers
KCLau Staff answered 6 years ago
If you compare the rate to the rate charged on your mortgage, use the 8.99%.
Because mortgage interest calculated daily.
Meanwhile, the personal loan if stated 4.88% flat rate, means you pay the full 4.88%, regardless of when your principal already reduced after each payment.