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How to calculate bank loan interest

1. Monthly interest rate: the interest calculated on a monthly basis. The calculation method is: monthly interest rate = annual interest rate ÷ 12 (months).

2. Daily interest rate: The daily interest rate is called the daily interest rate, and is calculated with the day as the interest calculation period. The calculation method is: daily interest rate = annual interest rate ÷ 360 (days) = monthly interest rate ÷ 30 (days).

3. Annual interest rate: interest is usually calculated annually as a percentage of the principal. The calculation method is: annual interest rate = interest ÷ principal ÷ time × 100%.

4. Annualized interest rate: refers to the interest rate that discounts the product’s inherent yield to the whole year, which is quite different from the calculation method of annual interest rate. Assume that the yield period of a financial product is year A and the yield is B, then the annualized interest rate R is calculated as R = (1+B) A-1.

5. Calculation formula for equal amounts of principal and interest: [Loan principal × monthly interest rate × (1 + monthly interest rate) number of repayment months] ÷ number of repayment months [(1 + monthly interest rate) number of repayment months - 1]

6. Calculation formula of average funds: monthly repayment amount = (loan principal ÷ number of repayment months) + (principal - cumulative amount of principal repaid) × monthly interest rate.

Extended information:

Bank loan refers to a type of bank loan that lends funds to people in need at a certain interest rate in accordance with national policies and agrees to return them within a specified period of time. economic behavior. Generally, a guarantee, house mortgage, or proof of income and good personal credit are required to apply.

Moreover, in different countries and in different development periods of a country, the types of loans classified according to various standards are also different. For example, industrial and commercial loans in the United States mainly include ordinary loan lines, working capital loans, standby loan commitments, project loans, etc. , and industrial and commercial loans in the UK mostly take the form of bill discounts, credit accounts and overdraft accounts.