The payment made each period on an amortized loan is constant, and it consists of some interest and some principal.The closer we are to the end of the loan's life, the smaller the percentage of the payment that will be a repayment of principal.

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As we get closer to the end of the loan's life, the percentage of the payment that is a repayment of principal increases, while the interest portion decreases.

The Payment Made Each Period on an Amortized Loan Is