Interest payments
what changes through the month
Interest
What is the principle payment
a payment that goes toward the repayment of the original amount of money borrowed in a loan.
what is amortization
the process of writing down the value of either a loan or an intangible asset.
Why do you determine interest for a amortizing loan
The interest on an amortized loan is calculated based on the most recent ending balance of the loan.
What goes up through out the month
Principle
What can you do to for payments to make the time shorter
Make extra payment through time.
How do you calculate the interest
multiply the principal amount by the interest rate and multiply the result by the number of years in the loan.
How do you calculate the principle payment
You subtract your down payment from the home final selling price.
what two components are used
Interest and principle