The most basic calculation formula for loan interest rates is loan interest = loan amount * loan interest rate * loan term. However, many people will find that their calculation in this way does not match the actual interest they have to repay, so Because you have been making repayments and the loan principal is decreasing every month, naturally you cannot use the total loan amount to calculate interest.

The calculation of loan interest is different for different repayment methods. Currently, the most common repayment methods are mainly divided into four types: equal principal and interest, equal principal, interest first and principal later, and one-time repayment of principal and interest. Methods, the calculation methods of interest for different methods are as follows.

1. One-time principal and interest payment: loan amount * loan interest rate * loan term. The general interest rate here is the annual interest rate, and the term is calculated in units of years;

2. First Principal after interest: loan amount * loan interest rate * loan term. This repayment method is generally monthly repayment, so the general interest rate is the monthly interest rate, and the loan term is calculated on a monthly basis.

3. Equal principal and interest: The repayment method of equal principal and interest means that the repayment amount in each period is the same, and its calculation formula is also the most responsible, which is [loan principal × monthly interest rate × (1 + monthly interest rate)^ Number of repayment months]÷[(1+monthly interest rate)^Number of repayment months-1].

4. Equal principal amount: Equal principal amount means that the principal repayment is the same every month. The calculation formula is (loan amount - repaid amount) * loan interest rate. The interest rate here is generally the corresponding monthly interest rate.

The above is the calculation method of loan interest. For those who are not good at calculation, there is actually a simple way to directly guide you how much interest you need to bear, and that is the loan interest calculator.

Legal basis;

Article 26 of the "Regulations of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Private Lending Cases"

The interest rate agreed upon by both parties If the annual interest rate does not exceed 24%, and the lender requests the borrower to pay interest according to the agreed interest rate, the People's Court shall support it. If the interest rate agreed between the borrower and the lender exceeds the annual interest rate by 36%, the excess interest agreement is invalid. If the borrower requests the lender to return the interest that has been paid in excess of 36% of the annual interest rate, the People's Court shall support the request.