Monthly Archives: June 2019

How to choose the best loan?


When you go to the bank or a financial institution to ask for a loan there are two terms that have to help you decide for the best offer. it is about the ASD and the ECA. In this note I tell you more about each one to help you choose the bank that offers you the lowest interest rate.

Both the TEA and the TCEA refer to the interest rate. The first term stands for the Annual Effective Rate, while the second refers to the Annual Effective Cost Rate.

How are both interest rates different?

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The TEA is the interest a bank will charge you for the credit you ask. So if you request 1,000 soles and the bank charges 10% the TEA will be 100 soles.

But in your monthly statement you will not only have to pay the TEA, but other bank commissions . The set of these other commissions, among other additional charges is known as the TCEA.

TEA and TCEA is always important

TEA and TCEA is always important

Knowing and comparing the TEA and the TCEA is not only important when you ask for a money loan. It is also necessary that you compare the TCEA, in the case of a vehicle credit, mortgage credit , loans for studies, etc. 

Some conclusions

Some conclusions

You must consider both the TEA and the TCEA when requesting a loan. If you have to prioritize any, I recommend that you look at the bank that charges you the lowest Annual Effective Cost Rate. Comparing is the key to access the best money or credit loan.