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What is the difference between a Fully Amortizing and an Interest Only loan?

April 26, 2017Amortizing fully loan

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What is the difference between a Fully Amortizing and an Interest Only loan?

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The interest rate on a Fully Amortizing loan includes both principal and interest in your monthly payments. In other words, the payments you make reduce the balance of the loan every month. An Interest-Only loan includes only interest payments each month, so the total balance of your loan stays the same.