"Principal" refers to the principal, that is, the amount obtained by the lender, and "interest" refers to the loan interest, that is, the
"Principal" refers to the principal, that is, the amount obtained by the lender, and "interest" refers to the loan interest, that is, the amount repaid by the lender, so the principal and interest can be understood as the sum of the principal plus the loan interest, and the principal and interest always exceed the principal, so settling the principal and interest means that the borrower repaid the principal and interest generated by the loan within the time limit. In general, the principal only represents the initial asset amount before the loan interest or profit is generated in the process of loan, savings or investment, and the calculation of interest only needs to apply the annual interest rate. The calculation method of principal and interest is: principal× annualized interest rate× time. What is the related content of clearing the principal and interest above?
Interpretation of equal principal and interest repayment method
Matching principal and interest repayment method is to divide the sum of the principal and interest of the loan by the total number of months in the repayment period, and the final value is the monthly repayment amount, so the monthly repayment amount is fixed, and the proportion of principal will gradually increase during the repayment time, while the proportion of loan interest will gradually decrease. This method is widely used in the market and strongly recommended by most financial institutions. Therefore, the lender pays the same amount on time every month within the specified repayment period, which is the repayment method of equal principal and interest. This paper mainly describes the significance of debt service and related knowledge points. The content is for reference only.