what is equal repayment of principal and interest?
1. The most important feature of the matching principal and interest method is that the monthly repayment amount is the same. Matching principal and interest repayment, also known as regular interest payment, means that the borrower repays the sum of the loan principal and interest at the same amount every month, but the proportion of the principal and interest in each month is different, and the monthly loan interest is calculated according to the remaining loan principal at the beginning of the month and settled every month.
2. In the matching principal and interest method, banks generally collect interest on the remaining principal first and then the principal, so the proportion of interest in monthly contributions will decrease with the decrease of principal, and the proportion of principal in monthly contributions will increase, but the total monthly contributions will remain unchanged.
3. The monthly repayment amount is the same. In the distribution ratio of principal and interest in the monthly payment, the proportion of interest paid in the first half of the period is large, but the proportion of principal is small. After the repayment period is over half, it gradually turns into the proportion of principal and interest is small. The total interest paid is more than that paid by average capital Law, and the longer the loan term, the greater the interest difference.
4. The monthly repayment amount of equal principal and interest is the same, so it is more suitable for families with normal spending plans, especially young people, and with the increase of age or promotion, the income will increase and the living standard will naturally rise; If such people choose the principal method, the early pressure will be very great.
how to repay the equal principal and interest?
after applying for a loan, the borrower will repay the loan with the same amount in each installment within the whole repayment period, provided that the loan amount, term and interest rate remain unchanged. Among them, the proportion of interest in the amount returned in each period decreases and the proportion of principal increases.
For example, I applied for a loan of 5, yuan in the bank, with an annual interest rate of 5% and a repayment period of 5 years. If the principal and interest are repaid in the same amount, the total principal and interest is about 56,614 yuan, and the average repayment period is about 943 yuan.
after handling the housing loan, you must repay it in time every month. It is also a good repayment method to choose and repay the principal and interest in equal amount. The above is about what is equal principal and interest repayment and how to repay it. When you apply for equal principal and interest repayment, you can consult the financial department in detail to learn about the specific matters of repayment.