1. The different manifestations of the two repayment methods

The most intuitive reflection of the two repayment methods is: the repayment amount of equal principal and interest is a fixed amount every month; The monthly repayment amount decreases month by month.

2. The monthly repayment amount is different.

The equal principal amount means that the monthly repayment amount is different and decreases month by month; it equalizes the loan principal according to the total number of months of repayment, plus the remaining principal of the previous period. Interest, thus forming the monthly repayment amount, so the monthly repayment amount of the equal principal method is larger, and then decreases month by month, and the more the repayment is, the less it is.

Equal principal and interest means that the monthly repayment amount is the same. Essentially, the proportion of the principal increases month by month, the proportion of interest decreases month by month, and the monthly repayment amount remains unchanged, that is, in each month In the distribution ratio of "principal and interest", in the first half of the period, the proportion of interest paid is large and the proportion of principal is small. After half of the repayment period, it gradually changes to a large proportion of principal and a small proportion of interest.

3. Suitable for different groups of people.

The equal-amount principal method has a larger repayment amount in the early period and then decreases month by month, so it is more suitable for lenders with strong repayment ability in the early period.

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. As age increases or job promotion, income will increase and living standards will naturally improve. Rise; if such people choose the principal method, the early pressure will be very high.

Extended information:

Whether it is the equal principal and interest repayment method or the equal principal repayment method, the essence of interest will not change. Interest rates are determined by the collective impatience of countless people. Due to impatience, that is, impatience, people always want to enjoy it early, so the exchange of "spot" and "futures" occurs; it is precisely because of impatience that the farther away "futures" are from today, the lower their value.

Therefore, in order to achieve a transaction between "spot" and "futures", the quantity of "futures" must be larger than the quantity of "spot", and the difference determines the level of interest rates.

Baidu Encyclopedia-equal principal and interest

Baidu Encyclopedia-equal principal and interest