1. Matching principal and interest repayment method, that is, the borrower repays the loan principal and interest by the same amount every month, in which the monthly loan interest is calculated according to the actual remaining loan principal and settled every month.

Because the monthly repayment amount is equal, in the monthly repayment at the initial stage of the loan, less loan principal will be repaid after deducting the interest settled on a monthly basis; In the later stage of the loan, due to the continuous reduction of the loan principal and the continuous reduction of the loan interest in the monthly repayment amount, the monthly repayment of the loan principal is more.

2. average capital repayment method:

Because the monthly repayment of the principal is fixed, and the monthly loan interest decreases month by month with the decrease of the principal balance, average capital repayment method has a large monthly repayment amount at the initial stage of the loan, and then decreases month by month, so there is a great pressure in the early stage of repayment of the equal principal.

3. Equal interest generally refers to equal principal and interest.

4. Difference:

① The total interest is different: for the same term and loan amount, the interest of equal principal and interest is much higher than that of average capital;

② repayment pressure is different: in average capital, the monthly repayment amount is more in the early stage, but less and less in the later stage, so the repayment pressure in the early stage is greater than that in the later stage. The equal amount of principal and interest is the same every month, so the pressure is moderate;

③ The cost of prepayment is different: average capital pays more principal in advance, while the interest paid in advance for the same principal and interest is more. Therefore, if we consider prepayment, the shorter the loan time, the more cost-effective average capital will be than equal principal and interest.

Tips: The above contents are for reference only, and no suggestions are made. If you need loan funds in the near future, you can log in to Ping An Pocket Bank APP- Finance-Loan to learn about our loan products and try to apply.

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