Among all repayment methods, matching principal and interest is not suitable for early repayment, especially when the borrower's repayment period has come to an end. Because there is more interest and less principal in the monthly payment in the early stage of equal principal and interest repayment, the early repayment is mainly to save interest expenses. When the borrower's interest has been paid almost, it is meaningless to repay in advance.
If the borrower must choose equal principal and interest to repay in advance, he needs to calculate his remaining loan principal and interest first. Then the borrower also needs to look at the remaining repayment period. If the repayment period is still 2/3, then prepayment is undoubtedly very cost-effective. If the repayment period is only 1/3, the interest saved by early repayment is limited.
In principle, the best time to repay the principal and interest in advance is when the repayment period is still 2/3. If the repayment is too early, the borrower may have to pay liquidated damages, which are different for each bank, and some liquidated damages may even exceed one year's interest expenses.
Matching principal and interest refers to a loan repayment method, that is, repaying the same amount of loans (including principal and interest) every month during the repayment period.
Equal principal and interest and average capital are not the same concept. Although the monthly repayment amount may be lower than that in average capital at the beginning, the interest paid in the end will be higher than that in average capital, which is also a method often used by banks.
Suppose the borrower obtains a personal housing loan of 200,000 yuan from the bank, with a loan term of 20 years and an annual interest rate of 4.2%, and pays the principal and interest on a monthly basis. According to the above formula, the monthly repayment of principal and interest is 1233.5438+04 yuan.
The above results only give the sum of the principal and interest payable each month, so it is necessary to decompose this sum of principal and interest. Still on the basis of the above example, one month is one installment, the balance of the first loan is 200,000 yuan, the interest payable is 700 yuan (200,000× 4.2%/12), the principal is 533.33 yuan, and the bank loan is still 198766.86 yuan; The interest payable in the second phase is (198766.67× 4.2%/12).