In the stock floating interest rate mortgage, anyone who takes the "loan benchmark interest rate" as the pricing benchmark needs to convert the interest rate pricing benchmark into LPR as the pricing benchmark. After the conversion, there are two results, one is fixed interest rate and the other is floating interest rate. In fact, what everyone is most entangled in is whether it is more cost-effective to convert into a floating interest rate or choose a fixed interest rate.

For the borrower of commercial housing loan, it is actually a choice between two options: one is to convert to a fixed interest rate, that is, to always implement this year's interest rate, and the other is to float the interest rate.

Then look at the difference between the current actual interest rate and the LPR (4.8%) released on February 20, 20 19 for five years or more. In each subsequent period, the loan interest rate is based on the then LPR plus this difference.

Extended data

The calculation formula of mortgage interest rate based on the benchmark loan interest rate is as follows: mortgage interest rate = benchmark loan interest rate * (1 floating ratio). First of all, this is a multiplication formula. The floating ratio is fixed and cannot be changed once it is determined. The benchmark loan interest rate is determined by the central bank, and it is unknown when it will change.

At present, the benchmark interest rate for loans over five years is 4.9%, which was last adjusted at 20 15 years, more than four years ago. The mortgage interest rate can go up and down. For example, if you go up by 20%, your mortgage interest rate will be 5.88% (= 4.9% * (1+20%)).