What are the repayment methods of mortgage?

When people buy real estate, most people will choose to use loans to buy a house. After all, it is still difficult for working-class families to spend so much money at once. So, what are the repayment methods of mortgage? Let's get to know it together!

What are the repayment methods of mortgage?

1, equal repayment of principal and interest

Matching principal and interest repayment method is to add up the total principal and interest of mortgage loan, and then distribute it evenly to each month of repayment period. As repayment, a fixed amount is paid to the bank every month, and the proportion of principal can be increased month by month and the proportion of interest can be reduced month by month. This is the most widely used way now, and it is also the way that most banks have implemented for a long time.

2. Repayment by average capital

Matching principal repayment means that the lender distributes the principal evenly to each month and pays off the interest from the previous trading day to the repayment date. Matching principal and interest, this repayment method has lower total interest expenses, but more principal and interest are paid in the early stage, and the repayment burden is reduced month by month. Average capital repayment method can also be called repayment method with interest and principal and average capital with unequal interest.

3. One-time repayment of principal and interest

Previously, the bank stipulated that if the loan term is less than 1 year (including 1 year), the principal and interest will be repaid in one lump sum at maturity, and the interest will be paid off together with the principal. However, with the change of repayment method, one year is expected to be extended to five years. In addition, this method is strictly approved by banks and is usually only open to small short-term loans.

4. Free repayment of provident fund

Free repayment is the only repayment method for provident fund loans. Compared with the traditional repayment of equal principal and interest or equal principal, the free repayment method of provident fund is more flexible.

Summary: The above is the relevant content of the mortgage repayment method introduced by Bian Xiao, hoping to bring help to everyone. Presumably, everyone knows something after reading it! If you want to know more relevant information, please pay more attention to Qijia. It will provide you with more complete, detailed and up-to-date information.