The best time for prepayment of equal principal and interest is before the actual repayment period accounts for 1/3 of the loan period. If the actual repayment period accounts for more than 1/3, it is not cost-effective to repay in advance.

Extended data:

First of all, introduce the common ways of bank loan repayment:

1, equal repayment of principal and interest: this is the mainstream repayment method at present. Especially for housing loans, the repayment method of equal principal and interest is basically adopted. In this way, the same amount will be paid every month, and the amount of principal and interest will be different, and the amount of principal in the early stage is greater than the amount of interest; The amount of interest paid later is greater than this amount. This repayment method is suitable for loan applicants with stable income, and it is more convenient to arrange income and expenditure; Its disadvantages are that the amount of interest paid is relatively large, the interest will not decrease with the decrease of principal, and the total interest on repayment is high.

2. Matching principal repayment: In this way, the loan applicant repays the same principal every month, and the monthly interest will decrease with the decrease of this amount. There are more principal and interest paid in the early stage, but the total amount of interest to be paid is relatively small, and the repayment burden is reduced month by month. This repayment method is suitable for loan applicants who have sufficient funds at hand after the loan and have high repayment ability in the early stage.

3. One-time repayment of principal and interest: If the loan term is within one year (including one year), the principal and interest will be repaid at maturity, and the interest will be paid with the principal. This repayment method is generally only open to small short-term loans. The applicability is not strong.

4. Pay interest and repay the principal on schedule: In this way, the loan applicant decides to repay the loan every month, quarter or year. Simply put, the loan applicant divides the money that needs to be repaid every month into several months according to different financial conditions. This repayment method is suitable for people with unstable income.

Banks should pay attention to the method of handling loans and choose the repayment method that suits them. Different repayment methods have different repayment funds every month, so you can choose according to your actual situation. The above is an introduction about how to repay bank loans cost-effectively.