There are certain pricing metrics which needs to be considered while calculating the loan payments. Some of these are mentioned below:
- Total Cost of Capital: this determines the overall cost of capital based on the weighed average of those costs.
- Annual Percentage Rate: It is the total amount of interest one has to pay each year.
- Average Monthly Payment: this system helps in keeping the track of the daily or weekly payments made for the loan at the end of the month.
- Cents on the Dollar: this showcases the amount one has to pay in interest and how much will it cost for every dollar one borrows.
Using the figures of the above mentioned, the cost or due interest that has to be paid in a loan can be calculated.
