What is amortization?
A. You repay your loan in monthly installments. If you have a Fixed Mortgage (that is, with an interest rate that remains fixed and unchanging for the entire term of the loan) like the ones available here, your installments are always for the same amount, and with part of the payment going toward the payment of the interest, and part toward the repayment of the money you’ve borrowed (the principal). The balance of the principal (what you still owe at any given time) is thus reduced slightly with each payment. If with a fixed interest rate, the amount of interest you owe will decrease as your principal balance decreases. As a result, over time, a larger fraction of each monthly payment is applied toward the balance each month. You can create an amortization schedule for fixed loans when they are originated this schedule will show how much of each payment will go towards interest and how much will go towards principal over the life of the loan. As your principal decreases, your equity in
