Personal loan glossary

Meaning: Interest charged on the full original principal for every month of the term, even as you pay it down. Two loans at the same "monthly rate" cost more under add-on than under diminishing balance.

Meaning: A yearly rate some lenders show on the disclosure statement, combining interest with certain charges. Compare APR only with another APR worked out the same way.

Meaning: Interest charged only on what you still owe, so the interest part of each payment shrinks over time. SSS and Pag-IBIG loans use this method, as our Pag-IBIG and SSS loans overview explains.

Meaning: One rate that turns interest and fees into a comparable figure, based on the money you actually receive. If two offers show EIR, the lower one costs less for the same amount and term.

Meaning: What the lender charges for the money, shown per day, per month or per year. A monthly rate times 12 gives a simple yearly figure, but it can hide compounding and fees.

Meaning: The cap the SEC sets on interest and fees for small, short-term, unsecured loans from lending and financing companies. The current limits are in our interest rates guide.

Meaning: A charge if you pay after the due date. Ask for the exact amount before you sign, and read online loan hindi nabayaran to know what lenders can and can't charge.

Meaning: The money that actually reaches your GCash, Maya or bank account after the lender deducts upfront fees. It can be less than the principal, so check both numbers.

Meaning: The amount you borrow, before any fees are deducted. Interest is usually worked out on this amount.

Meaning: A one-time charge for setting up the loan, often deducted from the principal. It's part of why net proceeds can be lower than what you applied for.

Meaning: Everything you'll pay back: principal, interest and fees, in pesos. When EIR isn't shown, compare this number for the same amount and term.

Meaning: Paying a loan off in regular, scheduled installments, each covering part interest and part principal. Monthly amortization is the amount due each month.

Meaning: The day each payment must reach the lender. Many borrowers line it up with payday on the 15th or 30th.

Meaning: How long you have to repay, in days, months or years. A longer term lowers each payment but usually raises the total cost.

Meaning: Paying the whole loan off early. Some lenders charge a fee for it, so ask before you sign.

Meaning: Taking a new loan to pay off an old one, ideally at a lower cost.

Meaning: Changing the terms of a loan you're struggling with, such as a longer term, after the lender agrees. It can lower each payment but add to the total cost.

Meaning: The government-owned body that collects credit data from banks, credit card companies and other lenders under the Credit Information System Act (RA 9510). Past due accounts and defaults count as negative information.

Meaning: A person who signs the loan with you and becomes responsible if you don't pay. Common for salary and cooperative loans. Read loan for unemployed for when a co-maker helps.

Meaning: Something of value, like a car or property, that secures a loan and that the lender can claim if you default. Most online personal loans are unsecured, so they need no collateral.

Meaning: Your borrowing and repayment track record over time. First-time borrowers often have none yet, which our first-time borrower guide addresses.

Meaning: The record of your loans, credit cards and payment history held in the credit information system. Errors happen, so check yours before a big application.

Meaning: A number that sums up how you've handled credit, used by lenders to decide on approval and pricing. In the Philippines it's built from data in the CIC system. A thin or bad record limits options but doesn't end them: see loan kahit may bad credit.

Meaning: The SEC licence a lending or financing company needs to operate. Ask for the CA number and check it against the SEC's lists. Sa madaling salita: walang CA, huwag umutang.

Meaning: The document that shows finance charges before the loan is finalised, as the Truth in Lending Act (RA 3765) and related regulations require. Read it for the EIR or APR, fees and total payable.

Meaning: Our free tool that suggests lenders based on a few answers, without asking for your personal details. Partner lenders with SEC details are also in the Top picks box.

Meaning: A loan app or website a lending or financing company uses to lend. It has to be registered with the SEC under that company.

Meaning: A loan repaid through payroll deduction, from SSS, Pag-IBIG, a bank or your employer. Compare it with a regular personal loan in salary loan vs personal loan.

Meaning: Lending and financing companies must be registered with the Securities and Exchange Commission. Registration alone isn't enough to lend. Check a lender in how to check if a lender is SEC registered.

Meaning: Collection practices the SEC bans for lending and financing companies under SEC MC 18 s.2019, such as threats, insults and contacting people in your phonebook. Know your rights in loan app harassment.

Meaning: A government-issued ID lenders accept to confirm who you are. Which ones count is in personal loan requirements and valid IDs.