China
Declining balance
A repayment method: the same principal every month plus interest on what is still owed, so the first payment is the highest and each later one smaller.
The principal is split evenly over the months of the loan. Each month’s interest is the remaining balance times the monthly rate, so it falls as the balance falls.
Compared with equal installments, you pay more in the first months and less interest in total. Vietnamese banks offer both methods; the calculator lets you pick one and shows the first month’s payment.
Related terms
- Annuity / equal installments
A repayment method in which every monthly payment is the same amount, principal and interest together, as long as the rate stays the same.
- Loan term
The time you have to repay the loan in full, counted in months or years.
- Floating rate
The rate a loan pays after the promotional period: the bank's base rate plus a margin. When the base rate changes, the monthly payment changes too.
Learn more
- Declining balance vs annuity: which fits your cash flow
Two ways to repay a home loan in Vietnam: how the monthly payment moves, how total interest compares, and when each one makes sense.