How much is the monthly payment for a 20 year 1 billion mortgage?

Conditions for borrowing 1 billion VND from a bank over 20 years.

To borrow 1 billion VND from a bank over 20 years, customers need to meet the following conditions:

- Customers must be Vietnamese citizens, aged between 18 and 75 years old.

- Currently living and working near branches of lending banks.

- Having a stable monthly income to ensure the ability to repay the debt.

- The loan has a clear and legitimate purpose.

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

- The customer has a good credit history and no bad debts with any bank or lending institution at the time of borrowing.

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If I take out a 1 billion VND mortgage loan over 20 years, how much will I pay each month?

Currently, banks commonly use the method of calculating interest based on a declining balance.

Then:

Total monthly payment = Monthly interest payment + Total monthly principal payment.

In there:

Monthly principal payment = Initial loan amount ÷ Number of loan months

First month's interest = Initial loan amount x Monthly interest rate

Interest for the second month = (Initial loan amount - Principal repaid) x Monthly interest rate

Similarly, from the third month onwards, interest will be calculated on the remaining balance.

Assuming a customer takes out a mortgage loan of 1 billion VND for 20 years (equivalent to 240 months) with an interest rate of 10% per year, the monthly payment would be as follows:

Monthly principal payment = 1,000,000,000 ÷ 240 months = 4,166,667 VND

Interest for the first month = 1,000,000,000 x (10% ÷ 12 months) = VND

Interest for the second month = (1,000,000,000 - 4,166,667) x (10% ÷ 12 months) = 8,265,416 VND

Interest for the 3rd month = (995,833,333 - 4,166,667) x (10% ÷ 12 months) = 8,230,833 VND

The calculation method is similar from the 4th month up to the 240th month.

Therefore, the monthly interest and principal payments for a 1 billion VND loan will gradually decrease each month.

Lagerstroemia (compilation)

Source: https://vtc.vn/vay-the-chap-1-ty-trong-20-nam-moi-thang-tra-bao-nhieu-ar848504.html