Why do you have to pay so much interest up front on a mortgage? - mortgage amortization formula
I understand how mortgage interest and the principle is determined by a formula amortization. My question is, how it can do legally for a lender? Is that correct? become or is, as it is. "
Thank you for your answers.
Sunday, January 24, 2010
Mortgage Amortization Formula Why Do You Have To Pay So Much Interest Up Front On A Mortgage?
2 comments:
In the 1930s, have become popular as a mortgage, pay only the interest. The problem is that you to refinance loans for every 5 years. When the loan was dried, it could refinance, not because he had no capital. Depreciation is sure, they deserve a bit of capital per month. It is much better than the car loan. /
The mortgage repayment is the same as most cars. It's the same formula. This is not an act is a law on the mathematical interest, the time and the balance of the original loan. The formula basically says he wants a loan was made, the monthly payment, all payments will be equal, and at the end of its term, the balance will be zero. The lender has said, I would like at an annual rate of X on any director salary paid each year. So, in summary, if you lend someone money and want a certain percentage per year, which we have to pay, but you want a fixed monthly payment at the end of the balance is zero for many years and not how it works mathematically. No scam, no tricks, just a few simple calculations and thought. If you have changed something in the formula that would change everything, for example, if you do not want your account balance would be at the end of the period is zero, only the first month, the proportion of high interest to pay, so long as the word.
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