Compare personal loans: the table lenders do not publish

Every personal loan offer reduces to five numbers. Write them down for each offer in the same order and most of the comparison is done.

Rate, and whether it is fixed or floating. The number on the offer letter, not the landing page. A floating rate moves with a benchmark; a fixed rate holds for the tenure. Two offers a quarter point apart are not comparable if one can move.

Processing fee, in rupees, with GST. A fee quoted as 2 percent is 2.36 percent once 18 percent GST is added, and it is deducted before the money reaches you. Ask for the rupee figure that will be withheld at disbursal.

Tenure, as sanctioned. If you asked for 36 months and the letter says 48, the lender has changed your total cost without touching the rate.

Prepayment terms: the charge, the lock-in and the limits. Whether part-payment is allowed, from which month, how often, and what percentage of the outstanding balance is charged on foreclosure. This is a price, and on a loan closed at the halfway mark it costs more than a point of rate.

Anything else in the disbursal. A loan-protection premium or membership fee added to the principal raises the EMI and is itself charged interest for the full tenure.

Two figures do the work.

Total cost of borrowing is every rupee that leaves you beyond the principal: interest over the months you hold the loan, plus the fee with GST, plus any foreclosure charge if you close early, plus interest on any add-on financed into the principal. Compare it when tenures or exit dates differ, because rupees do not need adjusting.

Effective rate is the rate that would reproduce your EMI on the cash you actually received. Take ₹4,00,000 at an illustrative 11.5 percent over 48 months with a 1 percent fee. The fee with GST is ₹4,720, so ₹3,95,280 reaches you. The EMI, calculated on the full ₹4,00,000, is ₹10,436. The rate at which ₹3,95,280 produces an EMI of ₹10,436 over 48 months is 12.14 percent. In a spreadsheet that is RATE(48, -10436, 395280) multiplied by 12. Compare it when tenures match and you expect to hold to term.

Neither figure includes the prepayment charge until you tell it when you will leave. That is the step most comparisons skip.

Four illustrative sanctions for the same borrower, ₹4,00,000 over 48 months. A has the lowest rate, the highest fee and a 4 percent foreclosure charge. D has the highest rate, no fee and no charge. Ranked by rate, A wins. Ranked by total cost with every EMI paid, B wins, A is ₹77 behind it and D is ₹9,459 behind.

Same four offers, closed after the 18th EMI. The outstanding balance on A at that point is ₹2,69,639. A 4 percent foreclosure charge with GST on that balance is ₹12,727. B, C and D charge nothing to close.

A has indeed paid the least interest to that point, ₹3,952 less than B. Then add what each loan cost to enter and to leave.

The rate on a lender's page is the floor of a pricing grid, reserved for a top-band score, a categorised employer, low existing EMIs and often an existing account. It is not a quote and belongs in no column of your table. The only rate that counts is the one on your offer letter, and you cannot see it without applying.

Comparing real offers therefore means more than one application, and each is a hard enquiry on your bureau file. The workable answer is to apply to two or three lenders inside a short window, a couple of weeks at most. Bureau scoring models generally treat several enquiries for the same product in a short span as one search for one loan, rather than as three separate attempts to borrow. Spread over three months, the same applications read differently.

Fix the amount and tenure before applying and hold both across every application. Three offers on three different amounts are three loans, not three prices for one loan.

Two situations where the answer arrives before you start.

The first is a pre-approved offer from your own bank at a rate you are unlikely to beat. If the rate is near the bottom of the range for your profile, the fee is waived or small and the prepayment terms are clean, a second application costs an enquiry and buys a table with one meaningful row. Read the five numbers on it with the same care. If they hold up, stop.

The second is a small loan, under about ₹50,000, where the fee dominates everything else. Take ₹40,000 over 12 months. At an illustrative 12 percent with a 2 percent fee, interest is ₹2,647, the fee with GST is ₹944 and the effective rate is 16.56 percent. At 14 percent with no fee, interest is ₹3,098 and that is the whole cost. The offer with the higher rate is ₹493 cheaper. At this size a point of fee is worth more than a point of rate, so the comparison is about fees only, and it may be a loan you do not need if the money will be back before your card's interest-free window closes.

There is a third case, the one most people never price: the loan you already have is the offer to beat, and nobody has put it in the table.

The sanction letter and the schedule of charges are the only documents in which all five numbers exist at once.

The table on this page only works with real offers in it, and real offers only exist after a lender has looked at you. The eligibility check in the app is the step before that. It pulls your credit report and shows the score and every account behind it, including any that are overdue, settled or written off, so you see what a lender will see before you submit an application anywhere. Offers are then listed only from lenders you are eligible for, and each still has its rate, amount and approval set by that lender, so the sanction letter remains the document to read line by line.

The row most comparisons miss is the loan you already hold. The app reads your bank and card transaction emails and, on Android, your transactional SMS, so the EMIs you are paying now are on screen without manual entry. It flags an existing loan priced above what you would be offered today and says whether switching is worth it after the fee, which puts your current loan into the comparison as the offer to beat. It is not a lender and earns a commission from lenders on loans taken through it; the diagnosis is free and is not held back until you accept a recommendation.

Install Unyfy on Android, or use the web app at app.unyfy.co.in on an iPhone.