The differences between equal amounts of principal and equal amounts of principal and interest are as follows:

1. Different definitions. Equal principal and interest is also called regular interest payment, that is, 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 settled month by month. The biggest feature of this method is that the principal increases month by month, while the interest decreases month by month. Equal-amount principal is also known as the repayment method with equal principal and equal principal and no interest. The lender spreads the principal into each month and pays off the interest between the last transaction day and the current repayment date. In this way, the principal remains unchanged and the monthly interest decreases month by month. In this way, the principal and interest paid in the early stage are higher than the same amount of principal and interest.

2. The suitable groups of people are different. Equal principal and interest payments are more suitable for families with a fixed monthly income, especially for young people. As their working experience increases, they may be promoted, which means an increase in income, thus easing loan pressure and improving quality of life. But if you choose equal principal amounts, the initial financial pressure will be very high. Equal amounts of principal are more suitable for users with certain deposits or users with strong working ability and good future income expectations. Only people with certain financial strength can easily afford the upfront payment of equal amounts of principal.

3. Interest rates are different. The total interest paid by the equal principal and interest method is more than that of the equal principal amount method, and the longer the loan term, the greater the interest difference. However, since the repayment amount of this method is the same every month, it is suitable for family spending plans, especially young people, who can use the principal and interest method, because as the age increases or the position is promoted, the income will increase. The first month's repayment amount of equal principal is the largest, and then it decreases month by month, and the more you repay, the less it gets. The total interest paid is less than the equal principal and interest method. However, this repayment method has a higher repayment amount in the early period of the loan period, so it is suitable for borrowers with strong repayment ability in the early period. Older people can use the principal method, because as you age or retire, your income may decrease. reduce.