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Why do interest payments decrease each month and the principal payment increases?

Carlton Burgess

in Student Loans

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Ross Pratt on February 26, 2019

Mortgages are typically "front-loading." That means the interest is paid more aggressively in the beginning of the life of the loan that the principal. As the loan matures, less of your payment is devoted to paying interest on the loan and more is applied to your principal balance. It is important to mark the extra payment as toward the principal, otherwise your mortgage servicer may apply any extra payment as an additional monthly payment instead of reducing the principal.


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