Personal housing loans to repay the two methods of comparison

Two of the individual housing loan repayments for a specific method:



Equal principal and interest repayment method, that is, each month the borrower to repay the loan equal to the amount of principal and interest, also known as the matching method; equal to repay the principal of law, that is, the borrower in equal monthly repayment of principal, interest on the loan principal with the monthly decline, It also reduced the amount on a monthly basis, the decrease also known as the law.



The assumption that the borrower from the bank to obtain a sum of 200,000 yuan in personal housing loans, the loan period of 20 years, the interest rate on loans to 4.2 ‰, debt service per month.



If we do not consider the time factor, the monthly debt service will simply accumulate throughout the repayment period, repayment of the principal amount equal under the law the borrower to pay interest on a total of 101,212 yuan, while the principal and interest method of matching a total of 117,856 yuan to pay interest, the two Compared to those, equal to repay the principal Act to pay 16,620 yuan less. However, the time factor to consider, on the interest rate to 4.2 ‰ two ways to repay debt service per month under the difference between the discount to the loan, the sum of 0. In other words, from the static, there are two ways to repay the interest differential, but dynamic, taking into account the time factor, the repayment of two completely different ways! Being overlooked because of the time value of money, Many borrowers choose the wrong idea that they equal pay principal and interest repayment of interest law.



In that case, both the repayment of interest are under way and how it calculated?



"Equal to repay the principal of" the same as the monthly repayment of principal, payable in monthly interest from outstanding loans with interest rates on loans are multiplied together to produce. In accordance with the above example, the monthly repayment of the principal should be 833.33 yuan, the first phase of the loan balance of 200,000 yuan, the principal of the return of 833.33 yuan and 840.00 yuan to pay interest (200000 × 4.2 ‰), there is a shortage of bank loans 199166.67 yuan; in the second period The return of the principal amount of 833.33 yuan and 836.50 yuan to pay interest (199166.68 × 4.2 ‰), there is a shortage of bank loans 198333.33 yuan; ... ....



"Law repayments of principal and interest equal," the return of principal and interest each month and the same, as the "principal and interest payments equal" formula is only given a month to meet the principal and interest and, therefore, need to break down and the principal and interest. More cases are still based, according to the formula for calculating the monthly repayment of principal and interest and should 1324.33 yuan, the first phase of the loan balance of 200,000 yuan and 840.00 yuan to pay interest (200000 × 4.2 ‰), we can only return the principal amount of 484.33 yuan, still 199515.67 yuan of loans owed to banks; the second phase of payment of interest should be 837.97 yuan (199515.67 × 4.2 ‰), the principal of the return of 486.37 yuan, there is a shortage of bank loans 199029.30 yuan; ... ....



Through case-by-phase analysis can be seen in the matching principal repayment and repayment of principal and interest equal law, banks are in accordance with the borrower's loan amount and the actual occupancy rates should be provided for the interest. Moreover, if the same discount rate will be discounted to the amount of each base period, the amount is equal to the full.



Some people may ask, I can not "equal to repay principal and interest" in the first principal of yet another interest, this is not a quick return of the principal and interest can be saved? In fact, in terms of the amount of each repayment Also the number of the principal, how much interest should be repaid, the total amount is the same, because no schedule for the payment of "interest" to be paid the same interest, then the next issue of the bank's outstanding amount remains the same.



Through the above analysis we can see that although all 200,000 yuan, a 20-year loan period, but due to the repayment of the principal amount of time, the bank occupied by the actual time the funds will be different. In general, "equal to repay principal and interest" to use bank loans to longer period of time, the interest rate in the same circumstances, we should also pay more interest. Therefore we can not simply that the "two ways to eventually repay the principal of the same, but the difference between the interest paid 16,620 yuan." The reason is that the principal difference is the difference in interest rates, the amount must be in accordance with the size and duration of dollars to pay interest should each with the difference between compound interest formula compared to the same point in time.



Can intuitively, in the 20-year repayment period, repayment of the principal amount equal before the law on 101 than on repayment of principal and interest equal to, so on repayment of the principal law on equal pay less should be part of the interest, The difference between the two types of repayment of interest law is less to pay 16,620 yuan in this part of the payment. Therefore it can be said that, according to the time value of money, whether law on equal principal and interest repayment, or repay principal on the matching law, the loan-to-it, and also by the fact shall be regarded as equivalent. Qian Hai lost to advance, you can pay less interest. The amount of money is on the basis of the borrower to pay at the front.



How to choose their own way of repayment



There is no way to repay both cost is not worthwhile, but depends on the suitability of their own economic situation. Choice of repayment methods is the key to their income to match the trend, as far as possible so that the income curve and consistent contribution.



Equal principal and interest repayment method is characterized by the return of the same principal and interest each month and easily make the budget. The early repayment of interest on the monthly mortgage payments account for most of that with the gradual return of the principal contributions to increase the proportion of principal. Equal principal repayment method is characterized by the return of the principal each month, according to the loan principal balance of the interest on a daily basis, the larger the early repayment, the monthly repayment amount is gradually reduced. Is due to the reduced monthly payments required careful calculation.



If the time for the abscissa, ordinate the establishment of funds for the two-dimensional coordinates, the method of matching contributions curve is a horizontal coordinate with the equilibrium of a straight line, and the decline is a downward curve. If the repayment period, the income curve on the rise, with the principal and interest repayment method of matching the curve is more consistent, if the income curve downward trend, with the repayment of the principal method of matching the curve more consistent. Therefore, in accordance with the general trend of revenue, matching the principal and interest repayment method is more applicable to current income, revenue is expected to be stable or increase borrowing, or the budget clear and stable income, in general for young people, particularly At first the work of the young people chosen for this approach in order to avoid too great a contribution in the early pressure. The principal repayment matching method is applied to income in the peak period, especially after the expected revenue will reduce or increase the financial burden on families, usually middle-aged and elderly.