Legal analysis: it should be determined according to the borrower's income and repayment ability. If the income is relatively stable, but not too high, you can choose to repay the principal and interest with the same amount; If the repayment ability is strong, you can choose to repay the principal in equal amount. There are two most commonly used repayment methods for bank loans: 1 and matching principal and interest repayment, that is, the borrower repays the same amount of loan principal and interest every month. Interest accounts for a large part of the monthly payment at the initial stage of repayment, and the proportion of principal becomes heavier and heavier with the increase of monthly payment. 2. Equal principal repayment means that the borrower repays the equal amount of principal and part of interest every month, and the interest will gradually decrease with the monthly repayment.

Legal basis: Article 35 of People's Republic of China (PRC) Commercial Bank Law. Commercial banks should strictly examine the borrower's loan purpose, repayment ability and repayment method. Commercial bank loans shall be subject to the system of separating loan review from grading approval. Law of the People's Bank of China of the People's Republic of China Article 28 The People's Bank of China may decide the amount, duration, interest rate and method of commercial bank loans according to the needs of implementing monetary policy, but the loan term shall not exceed one year.

How to repay the mortgage is the most cost-effective

The following three methods are the most cost-effective:

1, repayment by installment

Installment repayment is one of the repayment methods of personal housing commercial loans. If we choose the installment repayment method, then we can divide the loan into five stages and choose the principal to be repaid in each stage according to our actual situation. For example, people who just start a business can choose to pay less in the early stage and pay more in the later stage. It calculates the repayment amount at each stage according to the average capital or equal principal and interest. Generally speaking, we need to pay less interest.

2. Biweekly payment and repayment methods

Biweekly repayment method is to change the original mortgage repayment from once a month to once every two weeks. Although the repayment pressure has not changed every month, the repayment frequency has increased, which leads to the accelerated reduction of principal, so the repayment interest can be saved. It is more suitable for people with stable income. Biweekly payment will be very troublesome for our capital arrangement, and the penalty interest will be higher.

3. Portfolio loan

When you apply for portfolio loans, you can allocate provident fund loans and commercial loans reasonably. Maximize the use of provident fund loans to extend our loan life. Try to increase the monthly repayment amount of commercial loans and reduce the life of commercial loans. Because the interest on provident fund is low, the interest on commercial loans is high. This can save our repayment interest.

Extended data

1. Which repayment method is more cost-effective, the average capital of housing loan or the equal principal and interest?

1. Compared with the repayment method of equal principal and interest, the repayment method of equal principal pays less interest. When repaying in advance, both repayment methods calculate the proportion of interest payment according to the amount of principal occupied, so the difference is not very big.

2. By comparing these two repayment methods, in a sense, if you buy a house to repay the loan, the average capital method, as a repayment method with decreasing interest, may not be more advantageous than the equal principal and interest method, but which repayment method you want to choose depends on your actual situation.

What is the most cost-effective way to repay the loan?

Average capital's repayment law requires customers to have high repayment ability at the beginning, and the initial repayment pressure will be greater, but the monthly payment will decrease month by month, so the later pressure will become smaller and smaller. When other conditions such as interest rate remain unchanged, the interest paid by the equal principal and interest method will be higher than that paid by the average capital repayment method.

Which repayment method is cost-effective depends on the actual situation. The actual situation of different users corresponds to different repayment methods.

There are generally two ways to repay loans, one is equal principal and interest, and the other is average capital. Under the condition of constant interest rate, the repayment method of equal principal and interest fixes the monthly repayment amount in advance, which is convenient for you to remember. The repayment method in average capital is to divide your loan principal into equal parts within the loan term, and the loan principal returned every month is the same.

In addition, the repayment methods of the loan include monthly interest payment and principal repayment: that is, the borrower repays the loan principal in one lump sum on the loan maturity date [applicable to loans with a term of less than one year (including one year)], and the loan bears interest on a daily basis and the interest is repaid on a monthly basis.

Repay part of the loan in advance: that is, the borrower can repay part of the loan amount in advance when applying to the bank. Usually, the amount is an integer multiple of10,000 or10,000. After repayment, the lending bank will issue a new repayment plan, in which the repayment amount and repayment period change, but the repayment method remains unchanged, and the new repayment period shall not exceed the original loan period.

Repay all loans in advance: that is, the borrower can repay all loan amounts in advance when applying to the bank. After repayment, the loan bank will terminate the borrower's loan and handle the corresponding cancellation procedures.

Borrow and pay back: the interest after borrowing is calculated on a daily basis, and the interest is calculated on a daily basis. You can pay the money in one lump sum at any time without paying a fine.

There are several repayment methods for loans, which one is cost-effective? Just give an example.

Many people will choose to borrow money when they are short of money, and then repay it slowly. Many lending institutions will offer a variety of repayment methods for lenders to choose from, and different loan methods pay different interest, which makes many white people confused about which method to choose. Then there are several repayment methods for loans, which one is cost-effective? Here is a brief introduction for everyone, and it is clear to give an example.

How many repayment methods are there for loans?

There are three common repayment methods of loans, namely equal principal and interest, average capital and one-time principal and interest repayment. The differences are as follows:

1, equal principal and interest: that is, the interest repaid every month is the same. The monthly repayment is the principal plus all interest, and then distributed evenly to each month. Because the monthly repayment amount does not change much and the repayment pressure is relatively uniform, it is suitable for borrowers with relatively stable income and strong liquidity.

2. Average capital: that is, the monthly repayment of the principal is fixed, and the interest will decrease with the decrease of the principal. The total interest expense of this repayment method is less, but the repayment pressure is higher in the early stage, and the pressure decreases month by month with the decrease of interest in the later stage.

3. One-time repayment of principal and interest: that is, there is no need to repay the principal and interest in the first few months, and the last one will be repaid in one lump sum. It can be said that the borrower must repay all the debts in the last installment without repayment pressure. People who don't have the financial strength to save money should not choose this method.

Which is cost-effective?

Here is an example to compare the amount to be repaid in three situations. Suppose Xiao Li borrows 1.2 million yuan, with daily interest of one ten thousandth, and repays it in 1.2 installments.

1) Select the average capital. According to the formula: (loan principal/repayment months (principal-accumulated amount of repaid principal) × monthly interest rate, the calculated total repayment amount is 122340 yuan, that is, the total interest to be paid is 2340 yuan.

2) Select equal principal and interest, and calculate the total repayment amount according to the formula: [loan principal × monthly interest rate× (1 interest rate) repayment months] [(1interest rate) repayment months-1], in which the generated interest is 122352 yuan.

3) Choose one-time repayment of principal and interest. According to the formula: the term of principal interest rate, the calculated total interest is 7200 yuan.

It is not difficult to see that the average capital is more cost-effective than the equal principal and interest.

What is the best way to repay the mortgage?

There are two repayment methods of bank mortgage: equal principal and interest repayment and equal principal repayment.

Matching principal and interest repayment is a popular repayment method at present, and it is also a repayment method recommended by banks.

This is a repayment method with a fixed amount of expenditure. That is, the borrower repays the loan principal and interest with the same amount in each installment, and the repayment amount in each installment includes the principal to be repaid in the current period and the interest to be borne. During the whole repayment period, the monthly repayment amount is fixed.

Matching principal repayment means that the borrower will share the loan amount evenly throughout the repayment period and repay it monthly, and at the same time pay off the interest generated from the loan balance from the previous repayment date to the current repayment period.

The loan principal shall be shared equally throughout the repayment period, and the interest shall be calculated on a daily basis according to the loan principal balance. The monthly repayment amount is gradually decreasing, but the rate of repayment of principal remains unchanged.

1, equal principal and interest repayment method, that is, the borrower repays the loan principal and interest with the same amount every month, in which the monthly loan interest is calculated according to the remaining loan principal at the beginning of the month and settled every month.

Because the monthly repayment amount is equal, in the initial monthly repayment of the loan, the principal of the loan is less after excluding the monthly settlement interest; In the later period of loan repayment, due to the continuous reduction of loan principal and loan interest in the monthly repayment amount, more loan principal is repaid every month.

2. Average capital repayment method

Because the monthly repayment of the principal is fixed, the monthly loan interest decreases month by month with the decrease of the principal balance, so the average capital repayment method has a large monthly repayment amount at the initial stage of the loan, and then decreases month by month (monthly repayment amount = monthly repayment of the principal × monthly interest rate).

3, the difference:

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

② The repayment pressure is different: the average capital in the early stage has a large amount to repay every month, but the amount to repay in the later stage is getting less and less, so the repayment pressure in the early stage is high and the repayment pressure in the later stage is low. Equal monthly principal and interest, moderate pressure;

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

There is no fixed standard as to which repayment method is more cost-effective: average capital or equal principal and interest. Although the interest rate in average capital is much lower than that in equal principal and interest, it may not be suitable for everyone, so whether you should choose average capital or equal principal and interest when applying for mortgage depends on your actual situation.

This is the end of the introduction about which loan repayment method is cost-effective and which loan repayment method is more cost-effective. I wonder if you have found the information you need?