Compare a flat-rate loan against a reducing-balance loan quoted at the same nominal interest rate — the two cost very differently.
A flat rate charges interest on the full original principal for the entire tenure, even as you repay it.
A reducing-balance rate charges interest only on the amount you still owe, which gets smaller over time.
Flat interest: Principal × Rate × Years
Reducing EMI: Standard EMI formula
Why do some lenders advertise a flat rate?
A flat rate looks like a smaller number. But since it is charged on the full loan amount the whole time, the real cost is much higher than a reducing-balance loan at the same rate. Always ask for the reducing-balance version before comparing loans.