Is it better to buy a house with equal principal and interest or equal principal

Equal principal and interest are good.

Mortgage loans are generally repaid with equal principal and interest, and most banks also default to this repayment method. Among them, only a few use the average capital repayment method, which generally requires the customer to take the initiative to apply, so the bank will use the average capital as the repayment method of the mortgage.

The reason why the bank does this is because if the mortgage is repaid with equal principal and interest, the customer needs to pay more interest, and the bank can charge more interest, which is conducive to income; In addition, if the average capital repayment method is adopted, the customer will have greater pressure to repay in the early stage, so the credit conditions of the customer are higher, and the customer needs to have a certain economic foundation and stable economy, otherwise the possibility of overdue repayment is greater.

If the customer's economic conditions are poor and it is not suitable for excessive capital investment in the initial stage of mortgage repayment, it is better to choose equal principal and interest repayment. If customers don't want to pay too much interest, they can repay the loan early when they have money, which can reduce interest and reduce the cost of borrowing.

What is the formula for calculating equal principal and interest repayment:

Generally, the term of personal mortgage loans for home purchases is more than one year, so one of the repayment methods is the equal principal and interest repayment method, that is, from the second month of using the loan, the loan principal and interest will be repaid in equal amounts every month. The calculation formula is as follows:

Loan principal monthly interest rate (1 + monthly interest rate) number of months of repayment]; [1 + monthly interest rate) number of months of repayment - 1].

The following is an example of an equal principal and interest repayment method.

Suppose the borrower obtains a personal housing loan of 200,000 yuan from the bank, the loan term is 20 years, the annual interest rate of the loan, and the monthly repayment of principal and interest. According to the above formula, the sum of principal and interest payable each month is RMB.

What is the difference between equal principal and interest and average capital:

Equal principal repayment is the repayment of the principal in equal monthly instalments, and then the interest is calculated based on the remaining principal. Therefore, due to the large principal in the initial stage, the interest will be paid more, so that the initial repayment amount will be more, and the subsequent monthly will be reduced. The advantage of this method is that it is more suitable for families with strong repayment ability, and reduces the interest expenses incurred due to large repayments in the early stage.

Equal principal and interest repayment is the repayment of the same amount of loan (including principal and interest) every month during the repayment period. Since the monthly repayment amount is fixed, the expenditure of household income can be controlled in a planned way, and it is also convenient for each family to determine their ability to repay according to their own income.

1.Equal principal and interest are good.

2.Mortgages generally adopt the equal principal and interest repayment method.

Most banks also default to this repayment method, and only a small number adopt the equal principal repayment method.

And generally the customer needs to take the initiative to apply, and the bank will use the equal principal as the repayment method of the mortgage. The reason why banks are like this is because if the mortgage adopts the equal principal and interest repayment method, the customer needs to pay relatively more interest, and the bank can charge more interest, which is beneficial to the income; In addition, if the equal principal repayment method is adopted, the customer will have greater repayment pressure in the early stage, so the credit conditions of the customer are higher, and the customer needs to have a certain economic foundation.

The economy is relatively stable, otherwise it is more likely to be overdue. If the customer's economic conditions are poor, and the early stage of mortgage repayment is not suitable for excessive capital investment, it is better to choose the equal principal and interest repayment method. If the customer does not want to pay too much interest, he will repay the loan early when he has the money.

You can do it, so that you can reduce a certain amount of interest and reduce the cost of borrowing.

Extended Information:1Equal principal method and equal principal and interest method.

There is no big difference between good and bad, most of it depends on each person's current situation and needs. The equal amount of principal and interest is conducive to memory, planning, and convenient repayment. In fact, the vast majority of people prefer to choose the "equal repayment method", because this method has a fixed monthly repayment amount and balanced repayment pressure, and the difference from the equal principal method is not very large, and with the growth of time, it will make the use value of the funds.

made a difference. Of course, there are also many people who are relatively financially affluent and want to make their future life easier and cost-saving, so they will choose the equal principal method.

2.Equal principal and interest repayment: The monthly repayment amount is the same. Among them: the interest decreases month by month, and the principal increases month by month, which is equivalent to the loan interest rate.

Decreasing month by month, the loan interest rate in the early stage is higher than the contract interest rate, and the loan interest rate in the later period is lower than the contract interest rate. Equal principal repayment: The monthly repayment decreases month by month.

Among them: the interest decreases month by month, and the principal remains unchanged every month. Since many borrowers repay their loans in advance, choosing to repay with equal principal and interest is equivalent to the actual loan interest rate being higher than the contract interest rate.

The specific repayment method to choose when buying a house needs to be based on the actual situation of the borrower.

If it is to save more interest, then it is more cost-effective to choose the same amount of principal. Because the equal principal amount is to spread the principal amount to each month, and then calculate the interest based on the principal, decreasing month by month. In other words, the interest on the equal principal amount is lower than the equal principal and interest.

If the borrower chooses the same amount of principal, he can save more interest. It is more suitable for borrowers with a strong economic foundation, relatively high income, and can withstand greater repayment pressure.

If the borrower wants his monthly payment pressure not to be too great, it is better to choose equal principal and interest. Because the monthly payment of equal principal and interest is the same every month, the main repayment in the early stage is the loan interest. In such a situation, the borrower will have more interest on the loan, but the repayment pressure will be less.

Strictly speaking, equal principal and interest are more suitable for borrowers with stable income, but not very sufficient funds on hand. For example, some young people who have just had a stable job, or civil servants, etc.

In general, there is no superiority or disadvantage between equal principal and equal principal and interest. Borrowers only need to choose the repayment method that suits them according to their actual situation, and then repay the loan on time to avoid overdue.

Borrowers who apply for loans too often or carry out loan operations frequently will increase their personal credit risk. The higher the risk score, the more likely it is that the application will be rejected.

Extended Information: Equal Principal or Equal Principal and Interest for a Loan?

Whether to choose the equal principal repayment method or the equal principal and interest repayment method for the loan mainly depends on your own repayment idea and repayment ability.

For example, the equal principal amount is divided equally between the total amount of the loan, and then the same amount of principal and the interest accrued on the remaining outstanding loan are repaid each month; Equal principal and interest is the repayment of the same amount of the loan (including principal and interest) every month throughout the repayment period.

Therefore, the burden of the same principal in the early stage of repayment will be heavier, which is more suitable for those who have a certain economic foundation and can bear the greater repayment pressure in the early stage; The equal amount of principal and interest is more friendly to those whose income is more stable because they repay the same amount every month and facilitate the arrangement of income and expenditure, so the economic conditions do not allow excessive investment in the early repayment, and the income is in a more stable state.

You also need to note that it is precisely because of the greater pressure of the equal principal to repay in the early stage that the requirements for the economic income situation are also stricter. Banks generally recommend equal principal and interest, after all, under the same conditions, the interest charged for equal principal and interest is more than that of equal principal, and banks can have more income.

Hello. If you have more money and the income you can generate is not higher than the bank interest rate, it is more cost-effective to choose the same amount of principal. The equal principal amount is the same principal every month, but the interest is different, and the interest is getting less and less over time, so the overall monthly payment amount of the upfront principal plus interest will be relatively high.

If you have sufficient funds, you can choose to equal the principal. But there is also a premise, if you make other investments and the yield is higher than the bank rate, then you can choose the second one because the money can create more value for you.

If the upfront funds are not very sufficient, then equal principal and interest is a good choice, because the equal principal and interest are different each month, but the repayment amount is the same every month, so the early principal is less and the interest is more, but the total amount is the same every month, and the monthly repayment amount is less than the equal principal.

Hope mine can help you.

It is better to buy a house with equal principal, but the equal principal is under great pressure in the early stage of repayment, which requires you to have a certain financial base, and the equal principal and interest repayment is relatively small in terms of repayment pressure, but the interest is relatively high.

When buying a house, if the funds are still rich, the principal of the same amount is relatively high, although the amount of early repayment is a little more, but you can save some interest.

Equal principal and interest. Mortgages generally adopt the equal principal and interest repayment method, and most banks also default to the repayment method, only a small number of them adopt the equal principal repayment method, and generally require customers to take the initiative to apply, and the bank will use the equal principal as the repayment method of the mortgage.

This depends on personal ability and the time of early repayment in the later period, in fact, the whole is still about the same.

1. The same amount of principal is good. Equal principal and equal principal and interest are different repayment methods.

Equal principal amount refers to the equal amount of the loan during the repayment period, with a fixed principal repayment every month, but the decrease in principal repayment at any time will reduce the monthly interest payment.

Equal principal and interest is to split the principal and interest into several parts, and repay the same amount of principal and interest every month.

2. In the two ways of equal principal and equal principal and interest, the principal repayment is the same, but the interest will be different.

The repayment method of equal principal means that the principal amount repaid each month is the same, and the interest is calculated according to the current outstanding principal amount, that is, with the gradual decrease of the principal in the later period, the interest is also decreasing accordingly, and the total amount of monthly repayment in the later period is gradually decreasing, and the total amount repaid by this repayment method is much less. With a loan of 1 million yuan, a loan term of 30 years, and a loan interest rate of 5%, then the monthly repayment amount is 7,083 yuan, and the monthly repayment amount decreases by about 100 yuan, and the sum of the principal and interest expenses in 30 years is 1.76 million yuan. The difference between the two repayment methods:

193-176 = 170,000 yuan.

The right one is the best, equal principal and interest, fixed monthly repayment, low repayment pressure, suitable for young people who have just started in the workplace. The same amount of principal, high pressure of early repayment, suitable for people with relatively stable income. If there is an expectation of early repayment, it is recommended to use the same amount of principal, which will save a lot of money.

Extended Materials. The monthly repayment of principal is different.

Under the equal principal method, the monthly principal repayment amount is the same, i.e., monthly principal repayment = total loan amount and number of repayment months.

Under the equal principal and interest method, the amount of principal repaid each month is different, and the monthly principal repayment = loan principal monthly interest rate (1 + monthly interest rate) (repayment month serial number - 1) 1 + monthly interest rate) number of repayment months - 1.

The monthly interest repayment is different.

Since the amount of principal repaid each month is different in the two ways, the outstanding principal is also different, so the interest that needs to be repaid each month is also different, and the interest that needs to be repaid this month is the product of the outstanding principal at the beginning of the month and the monthly interest rate.

The total amount of interest is different.

Since the monthly repayment of the principal of the equal principal is fixed, and the upfront repayment of the principal is more than that under the equal principal and interest method, the total amount of interest is relatively small.

Whether to choose equal principal and interest or equal principal repayment method for a mortgage can be decided according to your own financial situation and repayment ability.

Equal principal and interest is to repay the same amount of loan (including principal and interest) every month during the repayment period, in other words, the monthly payment is the same; The equal principal amount is divided equally between the total loan amount and then repays the same amount of principal and interest accrued on the remaining loan each month, so the monthly payment may be larger at the beginning of the repayment and then the repayment will be smaller and lower.

It can be concluded that the equal principal is suitable for those who have a certain economic foundation and can bear greater repayment pressure in the early stage; Equal principal and interest is better for those whose economic conditions do not allow excessive investment in early repayment and whose income is in a relatively stable state.

It should also be noted that when the total amount of the loan, the loan term, and the loan interest rate are all consistent, the mortgage with the equal principal and interest repayment method will generate more interest than the mortgage with the equal principal repayment method, and the final total repayment will be higher. If you don't want to repay too much interest, you can also choose to pay the same amount of principal.

Before applying for a loan, you can go to the Xiaoqi letter check to check your credit status, if the credit is not good, slow down first, and wait for the credit risk score is not high, and the stain is almost non-existent before applying, it is easier to pass.

Strong repayment ability, equal principal cost-effective. The repayment ability is average, and you can only choose equal principal and interest. From an economic point of view, equal principal is good, because the equal principal repayment method will eventually repay less interest than equal principal and interest, which can save a lot of money.

From the perspective of repayment pressure, equal principal and interest is better, because the monthly repayment amount of equal principal and interest is fixed, and the repayment pressure is relatively average; However, the repayment amount in the early stage of equal principal repayment is high, and the repayment pressure is relatively large.

The repayment ability is average, and you can only choose equal principal and interest. From an economic point of view, equal principal is good, because the equal principal repayment method will eventually repay less interest than equal principal and interest, which can save a lot of money. From the perspective of repayment pressure, equal principal and interest is better, because the monthly repayment amount of equal principal and interest is fixed, and the repayment pressure is relatively average; However, the repayment amount in the early stage of equal principal repayment is high, and the repayment pressure is relatively large.

Some say that the building bought with the same principal regrets dying.

The equal amount of principal and interest is more in the early stage, and less in the later stage.

Dear, yes, if you have a lot of money, you can pay it back at once.

Kiss, that is, the equal amount of principal is repaid in the early stage is interest, it is possible that your principal has not been repaid at all in the first year, and it is all interest.