How much interest do I have to pay each month if I borrow 1 billion VND from the bank?

When needing to borrow 1 billion VND, many people often think of borrowing from banks because of their ability to provide large amounts of capital and preferential interest rate programs. However, borrowing 1 billion VND is usually suitable for secured loans (with collateral). Therefore, not everyone can borrow 1 billion VND from a bank.

Conditions for borrowing 1 billion VND from a bank.

To borrow 1 billion VND from the bank, customers need to meet the following specific conditions:

- Borrowers must be Vietnamese citizens residing and working in provinces and cities where the bank they wish to borrow from has branches.

- Having a stable income and sufficient ability to repay the loan.

- Legally valid collateral, owned by the customer or a third party, such as real estate, cars, savings accounts, etc.

- No bad debts at any bank or credit institution.

- For household businesses, it is necessary to have a business registration certificate in accordance with the law, and a feasible and effective production and business plan...

How much interest do I have to pay each month if I borrow 1 billion VND from the bank?

Each bank has a different lending interest rate. At BIDV Bank, the mortgage interest rate varies for each loan package. Specifically, home loans have a preferential interest rate of 7.3%/year, car loans have a preferential interest rate of 7.3%/year, student loans have an interest rate of 6%/year, and business loans have an interest rate of 6%/year... After the preferential period ends, the interest rate becomes variable and is usually 3-4% higher than the initial preferential rate.

However, interest rates may change depending on BIDV's policies at different periods.

Formula for calculating interest on a 1 billion VND loan

Typically, a loan of 1 billion VND would be in the form of a mortgage loan. Interest is calculated on the decreasing outstanding balance, and the principal is repaid in equal monthly installments.

Monthly principal payment = Loan amount / Loan term (months). Monthly interest payment = (Loan amount - principal paid) x interest rate (%/month).

Therefore, if you borrow 1 billion VND for 10 years at a preferential interest rate of 7.3% per year, the amount you will have to pay each month will be as follows:

Monthly principal: 8,333,333 VND. First month's interest payment: 1 billion VND x 7.3%/12 = 6,083,333 VND.

Adding up the principal amount, the customer has to pay in the first month: 14,416,666 VND

After the 12-month promotional period, if the interest rate increases to 11.3%/year, the amount of interest the customer will have to pay will be: ((1 billion - (8,333,333 X 12)) X 11.3%)/12 = 8,475,000 VND.

After that, the monthly interest payment will gradually decrease.

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