Which of the following statements best describes the behavior over time of the components of equal mortgage payments?
A) The proportion of interest expense to payment of principal remains the same.
B) Interest expense increases and payment of principal decreases.
C) Payment of principal increases and interest expense decreases.
D) Both payment of principal and interest expense decrease.

Question

Quizplus · Accepted Answer

In an equal mortgage payment, the interest expense decreases over time as the outstanding principal balance reduces, while the payment of principal increases, keeping the total payment constant.

Which of the Following Statements Best Describes the Behavior Over