1. The principal and interest can be decided according to different situations:

For those with less income in the early stage, you can choose the repayment method of equal principal and interest to relieve the pressure of the current loan, and then repay in advance after the future income rises, which can also save interest.

For people with higher income at present, it is more appropriate to choose the average capital, and the repayment amount will be reduced when the future income decreases, so as to avoid the risk of making ends meet in the future.

2. The difference between equal principal and interest repayment and equal principal repayment:

The main difference between the two is that the repayment amount of equal principal and interest in each installment is the same, that is, the monthly principal plus interest amount is the same, and the repayment pressure of the lender is balanced, but the interest burden is relatively large;

Extended information:

1. Average principal repayment method: the monthly principal is unchanged, the interest gradually decreases, and the repayment pressure in the early stage is great, but the repayment amount in the later stage gradually decreases, and the total interest burden is less.

2. One of the most important features of the equal principal and interest method is that the monthly repayment amount is the same. In essence, the proportion of principal increases month by month, the proportion of interest decreases month by month, and the number of monthly repayments remains unchanged. That is to say, in the "principal and interest" distribution ratio of monthly payment, the interest ratio paid in the first half of the year is large and the principal ratio is small. After more than half of the repayment period, it gradually becomes larger and smaller.

Note: In the principal-interest matching method, banks generally collect the interest of the remaining principal first, and then the principal, so the proportion of interest in the monthly payment will decrease with the decrease of principal, and the proportion of principal in the monthly payment will also increase, but the total monthly payment will remain unchanged.

3. The biggest feature of the average capital method is that the monthly repayment amount is different, showing a state of decreasing month by month; It divides the loan principal equally according to the total repayment months, plus the interest of the remaining principal in the previous period, thus forming the monthly repayment amount. Therefore, the average capital method has the highest repayment amount in the first month, and then decreases month by month, and the more, the less. In the law of average capital, the amount of principal that people repay every month is always the same, and the interest decreases with the decrease of the remaining principal, so the monthly repayment amount gradually decreases. Under normal circumstances, the total interest paid by equal principal and interest is more than the average capital. The longer the loan term, the greater the interest difference.

Is the loan equal in principal and interest or average capital better?

Relatively speaking, the repayment method in average capital will be more cost-effective than the repayment method of equal principal and interest.

1, the average capital repayment method is to distribute the loan principal evenly to each month during the loan period, and the interest decreases with the principal month by month. In other words, the borrower has to pay back the same loan principal every month, but the interest will decrease over time.

2. The matching principal and interest method is to divide the loan principal and interest equally into each month, and the borrower has to pay the same principal and interest every month. Generally speaking, the average capital method needs to pay less total interest, while the equal principal and interest method needs to pay more total interest.

Extended data:

1. The advantages and disadvantages of equal principal and interest are different from the average capital: in the case of the same loan term, amount and interest rate, the monthly repayment amount of average capital is greater than the equal principal and interest at the initial repayment stage. However, according to the whole repayment period, average capital's repayment method will save the expenditure of loan interest.

Second, the advantage of matching principal and interest is that the monthly repayment amount is the same, which is convenient for arranging income and expenditure. Suitable for borrowers whose economic conditions do not allow early repayment and excessive investment, and whose income is relatively stable. The disadvantage is that you need to pay more interest. However, most of the advance payment is interest, and the proportion of principal will increase after half of the repayment period, which is not suitable for early repayment.

3. The advantage of average capital is that the total interest is less than the equal principal and interest. The repayment amount decreases every month, and the later, the easier it is. Moreover, due to the large proportion of principal and small proportion of interest, it is very suitable for early repayment. The disadvantage is that the pressure of prepayment is great, and it needs to have a certain economic foundation and can withstand the pressure of prepayment.

Four. Matching principal and interest repayment: suitable for groups with stable income.

According to insiders, at present, the most repayment method handled by banks is equal principal and interest repayment. This repayment method is to add up the total principal and interest of the mortgage loan, and then share it equally every month during the repayment period. As a repayment, he pays a fixed amount to the bank every month, but the proportion of principal in the monthly repayment increases month by month, and the proportion of interest decreases month by month.

Which is better, the average capital of a loan or the equal principal and interest?

Average capital and equal principal and interest are common repayment methods of loans, but there are great differences between them. The following are five major differences between average capital and equal principal and interest:

The first point: the monthly payment is different.

1, the monthly repayment amount of the average capital will be reduced, and the principal paid in advance will account for a relatively large proportion.

2. Equal principal and interest will be repaid in a fixed amount every month, and the interest on early repayment accounts for a relatively large proportion.

The second point: the interest rate is different.

1. The average capital uses the simple interest rate method to calculate interest, and only the residual principal is calculated.

2. The equal principal and interest are calculated with compound interest, and the unpaid interest is also included, so the repayment interest of the equal principal and interest is higher than the average principal.

The third point: it is suitable for different people.

1, the average capital is suitable for older people to choose, because the repayment pressure is high in the early stage, but the repayment pressure will gradually decrease with age.

2. Equal principal and interest are suitable for young people to choose, because a fixed amount of repayment in each period is conducive to reducing the repayment pressure.

The fourth point: repayment pressure is different.

1, the average capital finally paid less interest, so from the overall repayment pressure, it was lower than the equal principal and interest.

2. Equal principal and interest, the same amount will be paid every month, but the total interest is higher than the average capital, so the overall repayment pressure is relatively large.

The fifth point: the degree of cost performance is different.

1. The average capital repays more principal in the early stage and less interest expense, which is suitable for early repayment.

2. Matching principal and interest means that you can hold more assets for investment in the early stage. As long as the return on investment is the loan interest rate, it is worthwhile.