The equal principal repayment method is a repayment method that is very simple to calculate and highly practical. The basic algorithm principle is to repay the loan principal in equal installments during the repayment period, and at the same time repay the interest generated by the unpaid principal in the current period. The method can be monthly repayment and quarterly repayment. The calculation formula is as follows:

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

For example, with a loan 45,000 yuan, the loan period is 5 years, for example:

Equal monthly principal repayment: 45,000÷(5×12)=750 yuan

Calculator:

First month’s interest: 45000×(5.58÷12)=209.25 yuan

Then the first month’s repayment amount is 750 209.25=959.25 yuan;

No. Two-month interest: (45000-750×1)×(5.58÷12)=205.76 yuan

Then the second month’s repayment amount is 750 205.76=955.76 yuan

By It can be seen that as the principal is continuously repaid, the interest on the unpaid principal in the later period will become less and less, and the monthly repayment amount will gradually decrease.

This method was launched in January 1999 and is being gradually adopted by various banks.

The equal principal and interest method is relatively simple

=(45000 45000*5.58*5)/(12*5)=959.25