Why does an amortization schedule show more interest at the beginning?
Staff Q&A from the 63Hours team.
Ask clear questions about the Florida real estate course and learn from course-specific answers.
Why does an amortization schedule show more interest at the beginning?
Staff Q&A from the 63Hours team.
Interest is calculated on the remaining balance, which is larger early in a standard fully amortizing loan. As scheduled principal payments reduce that balance, more of the level principal-and-interest payment goes toward principal. The course's amortization table separates payment, interest, principal, and remaining balance so you can follow the change month by month.
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Discussion prompt: Which balance is used to calculate the next period's interest?