At present, more than 90% of families have mortgages to repay. In the case of constant income, the level of mortgage interest affects the quality of life of families. Everyone wants as little interest as possible. Therefore, the 30-year interest on a 600,000-pound mortgage will be 620,000. Is this normal?

It can be said that this is a very normal thing. Borrowing money from the bank requires interest. The longer the loan time, the more the corresponding interest. The interest on a 600,000-yuan mortgage after 30 years is 620,000. If the repayment method of equal principal and interest is adopted, the interest rate of this loan is 5.48%, which is not high. We should know that the benchmark interest rate for bank loans over five years is 4.9%, and the loan interest rate of 5.48% is only equivalent to 12%. You should know that some people's previous mortgage interest rates have increased by 20% or even 30%.

After 30 years, the interest is more than the principal. Actually, there's no need to struggle. You know, this is a 30-year loan, not a 35-year loan. The purchasing power of 600,000 yuan 30 years ago is completely different from that of 600,000 yuan 30 years later. Just like in the 1980s, 10,000 yuan households were the representatives of the rich, but now if you only have 65,438+10,000 yuan in deposits, you can only be considered poor, so it is normal for the interest to exceed the principal after 30 years. Imagine that if you lend a sum of money to others for 30 years, the interest is less than the principal.

We can assume that I have 600,000 in the bank for 30 years. According to the deposit interest rate of 4%, the total interest for 30 years will be as high as 720,000, which means that the bank's lending at the interest rate of 5.48% is not enough to pay the interest of depositors, which is a loss. Of course, we just assume that it can't be calculated like this, because our mortgage needs to be repaid every month, and the principal of the deposit will remain unchanged or even more in 30 years. So how can we reduce interest?

The best way to reduce interest is to shorten the loan period, which can be shortened to 25 or 20 years. If it is shortened to 25 years, the interest will only be 500,000 yuan. If it is shortened to 20 years, the interest is only about 390,000 yuan, and the total loss is 230,000 yuan. There are also many people who think that this monthly repayment is just like working in a bank. In fact, we can change the algorithm, and then you may find it very cost-effective. After 30 years, the interest of 620,000 yuan is equal to the average annual interest of only 20,666 yuan.