A smaller repayment can make a loan look easier to manage. It can also keep you paying for longer. Before comparing offers, write down both the payment you must meet each month and the total amount you would repay under the stated schedule.
Compare like with like
Hypothetical example, not a lender quotation: Two loans each provide ₦200,000. Offer A requires six payments of ₦40,000. Offer B requires twelve payments of ₦23,000. Assume these figures include all compulsory charges and there is no extra upfront payment.
| Measure | Offer A | Offer B |
|---|---|---|
| Monthly payment | ₦40,000 | ₦23,000 |
| Number of payments | 6 | 12 |
| Total repayment | ₦240,000 | ₦276,000 |
| Amount above cash received | ₦40,000 | ₦76,000 |
Offer B reduces the monthly payment by ₦17,000 but increases total repayment by ₦36,000. This arithmetic does not calculate an annual percentage rate. Payment timing and the way charges are assessed matter to that calculation.
Ask for the missing fields
Use a comparison sheet with spaces for cash actually received, upfront charges, each payment date, number of payments, final payment, compulsory extras, and total payable. Ask whether the rate can change and what happens after a late payment or early repayment. An advertised borrowing amount may differ from the amount deposited if charges are deducted first.
The CFPB's US auto-loan guidance recommends looking at term, rate and total cost alongside the monthly payment. Its legal terminology and protections should not be assumed to apply to a Nigerian contract.
Cost and affordability are separate checks
The cheaper total is not automatically affordable. Put the proposed payment into your cash calendar and include other obligations. Equally, a payment that fits today may leave you committed for longer than you intended.
If an offer cannot provide a complete repayment schedule, leave its total marked unknown rather than guessing. Keep the dated terms with your comparison. The useful decision is whether the entire commitment fits your situation, not which advert displays the smallest monthly figure.
Source and review note
CFPB: Comparing loan offers beyond the monthly payment. Source reviewed 9 October 2026.
General financial education. All worked examples are hypothetical; they are not product quotations or personalized financial advice.
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