Loan Repayment and Interest Concepts

Payment is always larger than repayment.

Payment is only for interest.

Repayment is a one-time payment.

Repayment involves paying off borrowed money over time.

7% per annum

8% per annum

6% per annum

5% per annum

Annually

Semi-annually

Quarterly

Monthly

Only after the loan is fully repaid

After the first repayment

Before any repayments are made

Only at the end of the year

$10,000

$15,000

$12,000

$20,000

Loan amount - 0.07

Loan amount / 1.07

Loan amount + 0.07

Loan amount x 1.07

15 years

20 years

10 years

12 years

$1,646.92

$1,500.00

$1,700.00

$1,800.00

To decrease the loan term

To increase the loan term

To reduce the total interest paid

To increase the total interest paid

It reduces your monthly expenses.

It decreases your overall debt.

It allows you to invest money elsewhere for higher returns.

It increases your credit score.