Equal principal repayment is more cost-effective than equal principal and interest repayment.

The equal principal repayment method first divides the total amount of the loan into equal parts according to the number of repayment periods, and repays the same amount of principal and the remaining balance of the loan in that month. interest. Since the monthly principal repayment is fixed, the interest is getting smaller and smaller, and the monthly repayment amount is decreasing. In this way, the borrower has greater repayment pressure at first, but as time goes by, the monthly repayment amount becomes smaller and smaller.

Under the equal principal and interest repayment method, the monthly repayment principal will gradually increase, the interest will decrease month by month, and the monthly repayment amount will remain unchanged. Compared with the equal principal repayment method, the disadvantage is that it pays more interest, and the interest at the initial stage of repayment accounts for the majority of the monthly payment. However, this method has a fixed monthly repayment amount, which allows the borrower to control the family income and expenditure in a planned way, and also facilitates each family to determine their loan repayment ability based on their own income.

"Long-term loan and short-term repayment" means that the customer chooses a longer loan period when applying for a loan, and then during the repayment process, the loan repayment period is shortened as much as possible as the financial ability allows. The reason why you should choose a long-term loan and short-term repayment is because if the loan period is long, the interest charged will inevitably be more, the total amount to be repaid will be larger, and the repayment pressure will be greater.

In this way, if the repayment period is shortened by early repayment, a certain amount of interest can be reduced and customers can settle their debts earlier. Of course, if the customer does not have enough funds to finance the long-term loan and short-term repayment, he or she should first repay the loan in installments according to the repayment plan stipulated in the loan contract.

Be sure to pay it back on time to avoid being overdue and affecting your personal credit. Everyone also needs to pay attention to the fact that you have to choose the right time for long-term loans and short-term repayments. If you make early repayments right after you take out a mortgage, you may need to pay a certain amount of liquidated damages. Therefore, it is best for customers to repay the loan within the specified time before planning to repay the loan in a long term and in a short period of time.

Loan repayment methods:

(1) Equal principal and interest repayment: that is, the sum of the loan principal and interest is repaid in equal monthly installments. Housing provident fund loans and commercial personal housing loans from most banks adopt this approach. In this way, the monthly repayment amount is the same;

(2) Equal principal repayment: that is, the borrower will evenly distribute the loan amount and repay it in each period (month) during the entire repayment period, and pay the same amount at the same time. A repayment method that clears the loan interest from the previous transaction day to the current repayment date. In this way, the monthly repayment amount decreases month by month;

(3) Monthly interest payment and principal repayment on maturity: that is, the borrower repays the loan principal in one lump sum on the loan maturity date [with a period of one year] Applicable to the following (including one year) loans], the interest on the loan is calculated on a daily basis, and the interest is returned on a monthly basis;

(4) Repay part of the loan in advance: that is, the borrower can apply to the bank to repay part of the loan amount in advance , the general amount is 10,000 or an integral multiple of 10,000. After repayment, the loan bank will issue a new repayment plan, in which the repayment amount and repayment period will change, but the repayment method will remain unchanged. And the new repayment period shall not exceed the original loan period;

(5) Repay the entire loan in advance: that is, the borrower can apply to the bank to repay the entire loan amount in advance. After repayment, the loan bank will terminate the loan. The borrower's loan and go through the corresponding cancellation procedures;

(6) Borrow and repay at any time: interest after borrowing is calculated on a daily basis, and one day is used to calculate the interest. You can settle the payment in one lump sum at any time without penalty.