Questions and Answers
What happens to any amount paid beyond the minimum monthly debt service on an amortizing loan?
It goes toward paying down the loan principal
In an amortized loan, how are the monthly payments split?
Between interest and the loan principal
What is a common characteristic of unamortized loans?
Interest-only payments during the loan period
How can a borrower pay off a balloon payment in an unamortized loan?
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What is the purpose of a loan amortization schedule?
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