Equated principal and interest calculation formula: [Loan principal × monthly interest rate × (1-month interest rate) ^ number of repayment months] ÷ [(1-month interest rate) ^ number of repayment months - 1]

Equated principal calculation formula: monthly repayment amount = (loan principal ÷ number of repayment months) (principal - cumulative amount of repaid principal) × monthly interest rate

Equal principal and interest, Refers to a method of repayment of a loan. Equal principal and interest payments are equal monthly repayments of the loan (including principal and interest) during the repayment period.

Extended information

The equal principal and interest repayment method means that the borrower repays the loan principal and interest in equal amounts every month. The monthly loan interest is calculated based on the remaining loan principal at the beginning of the month and is calculated monthly. pay off. This repayment method allows borrowers to reasonably arrange their monthly living and financial management (such as renting a house, etc.). It is undoubtedly a better choice for those who are proficient in investment and good at "making money with money" .

Example

Assume that the principal is 10,000 yuan, the bank loan is for 10 years, and the base interest rate is 6.65. Compare the differences between the two loan methods:

Equal principal and interest repayment method

Monthly interest rate = annual interest rate ÷12=0.0665÷12=0.005541667

Monthly repayment principal and interest = [10000×0.005541667×(1 0.005541667)^120] ÷〔(1 0.005541667)^120 -1〕=114.3127 yuan

Total repayment is 13,717.52 yuan

Total interest is 37.1752 million yuan

Equal principal repayment Method:

Monthly repayment amount = (loan principal ÷ number of repayment months) (principal - cumulative amount of repaid principal) × monthly interest rate

= (10000 ÷120) (10000 - cumulative amount of principal repaid) × 0.005541667

The first month’s repayment is 138.75 yuan, which decreases by 0.462 yuan every month

The total repayment is 13352.71 yuan

Interest 3352.71 yuan

Reference: Baidu Encyclopedia - Equal principal and interest