In the course of buying a house, many people opt for loans to buy a house. So, do you know what different ways of paying back? Understanding these common repayments can help you to choose the best way to repay them。

What's the best way to repay a mortgage

** The manner in which mortgages are repaid:**

**1, Equivalent principal repayment**

This approach has been long recommended by most banks and widely accepted. The rationale is to add the principal of the loan to the total interest, divided by the duration of the loan, and to distribute the total amount to the monthly repayment. As a result, monthly repayments are fixed, except for a gradual increase in the principal share of monthly repayments and a gradual decrease in interest。

**2. Equivalent principal repayment**

Equivalent principal repayments mean that the principal of monthly repayments is fixed and interest is reduced on a monthly basis, thus gradually reducing the total monthly repayments. This repayment modality is appropriate for middle- and senior-aged borrowers who are expected to experience a possible decline in future earnings, as it allows them to gradually reduce repayment pressures over time。

**3 One-time debt service**

Previously, when the duration of the loan was one year or less, a lump sum payment was made. However, with the reform of the repayment modality, this period may be extended to five years. This method of approval is rigorous and usually applied only to small short-term loans。

**4 Provident Fund repayments**

The full use of the Provident Fund loan and the extension of the loan ' s length, when using a PRF-purchase or portfolio loan, would benefit from low interest rates while reducing the repayment of the monthly Provident Fund. If portfolio loans were introduced, the balance in the Provident Fund account would be used to offset commercial loans, in addition to the amount available for the accumulated fund month, thus saving more interest。

** Retainability of loan repayments:**

**1 Small loans**

If the loan is smaller or the amount to be repaid is smaller, the bank will generally take up the request for a change in the repayment mode. Thereafter, the parties would need to re-establish the mortgage contract。

**2. Large loans**

In the case of a larger loan or a larger amount to be repaid, the bank will not normally permit a change in the repayment mode unless the borrower can provide evidence of a high repayment pressure, and the bank may appropriately extend the processing time to ease the repayment pressure。