Quote:
Originally Posted by biker1
Please spare me the snarkyness. I understand amortization just fine and can derive the formula for you if you wish. The interest is computed on the outstanding balance at each payment period. This results in the majority of the interest being paid in the early half of the loan. This is what I call front loading. If you want to use some other term then fine. The concept is clear.
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Bingo!!!!
TV bonds or a mortgage is not interest front end loaded. Interest is based on the monthly outstanding balance and the principal reduction is based on the overall fixed P&I payment.
Front end interest loaded loans are something different.
