Loan principal recovery includes two parts: loan principal recovery income and loan principal recovery income. The principal income from loan recovery is mainly the principal income from technical transformation loans and other financial loans recovered by governments at all levels. The principal income from loan recovery refers to the principal income recovered from local governments, relevant departments or enterprises after government departments borrow from foreign governments and international financial institutions.
The meaning of loan principal:
The loan principal refers to the amount of money borrowed by the borrower from the lender. The loan principal does not include any expenses (such as insurance premium, evaluation fee, etc.). ) what needs to be spent in the process of borrowing money. These expenses need to pay interest and belong to the loan cost.
Average capital or average capital and interest:
1: Look at the total interest: the equal principal and interest is greater than the average capital.
If the loan term is the same, is it more economical to match the principal and interest or the average capital? For example, if we take a mortgage of 6,543,800 yuan (taking a 20-year term as an example), the total interest paid by matching principal and interest is 570,000 yuan, and the total interest paid by average capital is 490,000 yuan.
Through calculation, we can know that the average capital pays less interest, and the total interest of the average capital is more cost-effective.
2. Look at cash flow
In the short term, the cash flow is abundant, and you can choose the average capital, which belongs to the model of more before and less after. If the cash flow is insufficient in the near future, choose equal principal and interest.
Because the average capital has the pressure to repay in advance, if the income is unstable in the near future, it is not recommended to choose the average capital or repay in advance for office workers' income. After all, the monthly quality of life has declined, and now the interest on bank loans is relatively low. In fact, it is not cost-effective to withdraw money in advance; However, it is more cost-effective to choose average capital for those who are well-off and intend to end this "house slave" life ahead of schedule.
3. Look at the loan term.
If the loan may be repaid several years in advance, the average capital is selected, and if it is not repaid in advance after 10, the equal principal and interest are selected.
Average capital, also known as repayment method of principal plus interest and average capital plus unequal interest, has less total interest than repayment method of equal principal and interest. This is because the repayment method in the average capital is that the repayment amount is gradually decreasing, that is to say, the monthly repayment amount is different, the total loan amount is evenly distributed according to the repayment month, and the interest on the remaining principal of the last repayment is calculated to form the monthly repayment amount. Therefore, if you plan to repay the loan in advance, it is more cost-effective to choose average capital than equal principal and interest.
4. Look at the expected return and loan interest rate.
Choose a school district with equal principal and interest for new houses and average capital for old houses. When the interest rate is low, choose equal principal and interest. With the rapid economic development, the living standard is getting higher and higher, and the purchasing power of RMB is relatively reduced. If conditions permit or there is demand, we just need to choose the loan as long as possible.
5. Look at the first set of qualifications
It's not easy to qualify. Try to use 70% of the loan for the longest term. It is recommended to choose equal principal and interest for the first new house. This can bear less repayment pressure.