Let's look at the definition first.
The average capital is that you pay the same principal every month, and the interest is more first and then less.
Interest first, then capital, means paying interest first, then paying the principal.
Matching principal and interest is even simpler, and the same amount of money is paid every month.
The three different repayment methods are very different, because the utilization rate of principal is different, and the utilization rate of principal first and interest later is the highest, so the interest paid is also the most. When the loan amount and interest rate are the same, the average capital pays the least interest, and the interest paid first is the most.
The specific relationship between the three is as follows: the average capital is equal to the principal and interest first, and the principal is later.
Tencent Microfinance and Baidu, which we are familiar with, both use equal principal repayment, while Ant Financial has two repayment methods: equal principal and interest and interest before principal.
Let's talk about the specific application of equal principal and interest. When we buy a 5499 yuan mobile phone in installments, if we choose 12 installment repayment, then the monthly payment given by the system is 5 19.99 yuan, so what is the actual interest rate we bear?
Briefly repeat how to calculate the real interest rate with EXCEL. EXCEL has an IRR function, which can be calculated conveniently and quickly.
Enter 5499 yuan in A 1 of EXCEL, indicating the borrowed money. Enter -5 19.99 yuan in A2 to A 13, indicating that the money will be returned to the merchant every month. Then enter the formula = IRR (a1:a13) *12 in any space in the table, and press the space bar to get the actual annual interest rate when we purchase the same principal and interest.
On the surface, the mobile phone with equal principal and interest only paid 740.88 yuan, but the real interest rate reached 24%. Because under this repayment method, the borrowed principal is not used up in the whole cycle. Similarly, the average capital has not used up the whole cycle, and average capital has to be repaid every month. For example, Baidu has money to spend, and the repayment amount of each installment is average capital plus interest on the remaining principal. In this case, the real interest rate is the interest rate given by the system.
Calculated on normal days, the annualized rate is 14.6%. Compared with the above matching principal and interest shopping, it saves a lot of money. If the principal is repaid with interest, the interest rate will be much higher than this.
It is simpler to have interest before capital. The principal we borrowed was used up in the whole period, so there was no interest rate conversion. For example, if you borrow 20,000 yuan from a borrower and choose to repay the interest first and then the principal, and the monthly interest is 3,000 yuan, then the annualized interest rate is (300/20,000) * 12 = 18%.
When choosing a loan, we should also pay attention to whether the product will charge a service fee other than interest, otherwise the interest rate will be higher. At present, there is no service charge for rich flowers, micro-loans and loans under BAT.
I also want to popularize "equal interest" with you, that is, you have to pay back the equal principal every period, and the interest of each period is also calculated in full according to the principal. If you encounter this repayment method, you must stay away.
We might as well calculate it, because the principal has to be calculated together with interest, and the interest rate of each period is different. The higher the interest rate, such as the second repayment of 20,000 12 and the nominal interest rate of 18%, then only the principal 1666.67 yuan is actually used in the last installment, but the interest rate is still calculated at 20,000, so the real interest rate in the last installment.
Is the equal principal and interest paid first or the principal paid first?
Matching principal and interest repayment method is to repay the same amount of loans (including principal and interest) every month during the whole repayment period, so in fact, the principal and interest should be repaid every month, instead of paying interest first and then the principal.
Matching principal and interest refers to the repayment of the same amount of loans (including principal and interest) every month during the repayment period, which is a repayment method of loans.
This is a concept different from average capital. Although the monthly repayment amount may be lower than the average capital repayment method at the beginning, the interest paid in the end will be higher than the average capital repayment method commonly used by banks.
Calculation method:
The calculation formula of monthly repayment amount is as follows:
[loan principal × monthly interest rate ×( 1+ monthly interest rate) repayment months ]=[( 1+ monthly interest rate) repayment months-1]
The following examples illustrate the equal principal and interest repayment method. Suppose that the borrower obtains a personal housing loan of 200,000 yuan from the bank, with a loan term of 20 years and an annual interest rate of 4.2%, and repays the principal and interest every month. According to the above formula, the monthly repayment of principal and interest is 1233.5438+04 yuan.
Average capital refers to a repayment method, in which the total loan amount is divided into equal parts during the repayment period, and the same amount of principal and interest generated by the remaining loans in the month are repaid every month, so that the monthly repayment amount is fixed.
Interest is getting less and less, and borrowers are under great pressure to repay at first, but as time goes on, the monthly repayment amount is getting less and less.
Calculation method:
It is also convenient to determine the repayment ability according to your own income.
The total expenditure of this repayment mode may be reduced relative to the matching principal and interest, but the repayment pressure is greater at first.
If it is used for mortgage, this method is more suitable for people who are at the peak of work or are about to retire.
Calculation formula of average capital loan:
Monthly repayment amount = (loan principal/repayment months)+(principal-accumulated amount of repaid principal) × monthly interest rate.
Microfinance and low interest rates:
For example, the loan is 6.5438+0.2 million yuan, the annual interest rate is 4.86%, and the repayment period is 654.38+00 years;
Matching principal and interest:1repayment after 0 years 15 1750.84 yuan, with total interest of 3 1750.84 yuan.
Difference:
Matching principal and interest method, the definition of matching principal and interest is that the principal increases month by month, the interest decreases month by month, and the monthly repayment amount remains unchanged.
The borrower repays the loan principal and interest in equal 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 on a monthly basis. The monthly repayment amount is the same, which is a good choice for people who are not well off.
The law of average capital and average capital are defined as constant principal, decreasing interest month by month and decreasing repayment times every month. The lender will allocate the principal to each month and pay off the interest from the previous trading day to the repayment date. Compared with the matching principal and interest, the total interest cost of this repayment method is lower, but the principal and interest paid in the early stage are more, and the repayment burden is reduced month by month.
Should I pay the principal or interest first?
Of course, the principal is paid first, and then the interest is paid. It's just that bank loans usually repay the principal and interest at the same time, but the proportion structure of principal and interest is different: \x0d\ 1). The advantage is that the borrower can accurately grasp the monthly repayment amount and arrange the family's income and expenditure in a planned way. This is more convenient and easier to remember. The disadvantage is that the total interest expenditure is relatively high, which is suitable for customers with stable income and little change in expected income to buy a house for their own occupation; \x0d\(2) average capital repayment method and decreasing repayment method. The advantage is that the interest expense is relatively small, but the disadvantage is that the monthly repayment amount is gradually reduced, and the pressure of early repayment is greater. It is suitable for home-occupied customers who have higher income at present, or whose monthly repayment accounts for a small proportion of the family's monthly income, but their expected income is uncertain; \x0d\ When using the diminishing method, the interest paid several months in advance is not more than that paid by the equal principal and interest repayment method, because there are more repayments in advance and more principal. There is no need to pay interest for prepayment.
Is interest paid in advance equal to principal and interest or average capital?
Average capital pays interest first.
Average capital:
1. Concept: spread the principal evenly every month, and pay off the interest between the last repayment date and this repayment. The principal and interest paid in the early stage are more, and the repayment burden is decreasing month by month.
2. Advantages: (1) The overall interest expense is low; (2) Monthly repayment or quarterly repayment
3. Disadvantages: The early repayment burden is heavy, especially in the first repayment period.
4. Applicable people: people with higher incomes, such as executives, Jinling, returnees, etc.
Average capital plus interest
1. Concept: add up the total principal and interest of the mortgage loan, and then distribute it evenly to each month of the repayment period. The borrower pays a fixed amount to the bank every month, but the proportion of principal in the monthly repayment increases month by month, and the proportion of interest decreases month by month.
2. Advantages: (1) The proportion of principal in monthly repayment increases month by month; (2) The proportion of interest decreases month by month;
3. Disadvantages: (1) It takes up more bank funds at the initial stage of repayment; (2) The proportion of monthly repayment of principal increases month by month.
4. Applicable people: employees of state enterprises and institutions with stable income, etc.