The less the mortgage, because the repayment method chosen by the borrower is average capital. After choosing this repayment method, the borrower needs to repay the same amount of loan principal and a part of loan interest every month. As a part of the principal will be repaid every month, with the passage of time, the borrower needs to repay less loan interest every month, so the monthly repayment amount is naturally less and less.

Although calculated according to the whole repayment period, the total repayment amount of the repayment method in the average capital will be less than that of the repayment method with equal principal and interest. However, in the early stage of repayment, the repayment pressure of equal principal repayment is greater. This repayment method is more suitable for people with strong repayment ability in the early stage, or those who are about to retire.

The calculation formula of average capital loan is: monthly repayment amount = (loan principal/repayment months)+(principal-accumulated repaid principal × monthly loan interest rate. According to this calculation formula, it can be seen that the larger the loan amount and the longer the repayment period, the greater the amount that can be saved by repayment of equal principal.

If the borrower chooses to repay in advance, due to the repayment method in average capital, the loan principal will be mainly repaid in the early stage. Therefore, if you choose to repay in advance, you can reduce the interest you need to pay when you repay later. Therefore, if you choose to repay the loan in advance, or use the annual provident fund to offset the loan principal, you can pay off the loan faster.

Is it worthwhile for the average capital to repay the mortgage in advance?

1. In the repayment method of equal principal and interest, the sum of loan principal and interest repaid every month is fixed, and the monthly repayment pressure is balanced, but the principal and interest repaid every month are variable-the loan repays more interest in the early stage, less principal, and more principal repaid in the later stage, but less interest. If the loan is paid off in advance, the one-time repayment amount is the remaining principal and the outstanding interest as of the date of paying off the loan. The amount of interest saved by early repayment is related to the time to pay off the loan in advance. The sooner you repay the loan in advance, the more interest you will save.

2. People who are suitable for repaying loans in advance need to meet the following three conditions: First, choose the equal principal and interest repayment method, and within five years before repaying loans, such people can repay loans in advance because they can save a lot of interest. Secondly, I have spare money in my hand, but I have no other way, or it is lower than the loan interest rate. After that, it is unlikely that there will be any big expenditure in the near future.