Cost per thousand

C

Calico

Registered User
Messages
432
Is it okay to compare cost per thousands by calculating it using the APR?

AIB use the daily (?) rate here [broken link removed]
 
Not sure I understand the question. Cost per thousand should be calculated using the nominal rate, not the APR.
 
LDFerguson said:
Not sure I understand the question. Cost per thousand should be calculated using the nominal rate, not the APR.
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Why? And how do you work out the nominal rate and hence cost per thousand if all they give you is the APR (e.g. [broken link removed])
 
If the rate is discounted for the first year, the CPT will be different during the discount period and the follow-on period. Ditto fixed rates. The APR attempts to show the long-term effect of these fluctuations. Which is why it's not suitable for calculating the CPT.

If the nominal rate is not quoted on a lender's website, you need to ask them what it is before you can calculate the CPT.
 

Well, it's incredible that they don't quote the CPT. That should be a standard I would have thought.

Is the CPT calculated using APR useless then?
 
There's an obligation to publish the APR. Others are optional.

Is the CPT calculated using APR useless then?
Click to expand...

Pretty much - it's unlikely to tell you what the actual monthly repayment will be unless the APR and the nominal rate happen to be the same.
 
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