a loan is structured to pay back higher portions of interest first and gradually increase principal…

a loan is structured to pay back higher portions of interest first and gradually increase principal payments. this benefits the ... lender borrower loan amount $200,000 loan term 30 years interest rate 6% monthly payment $1,199.10 annual payment $14,389.20 54% payment on interest 46% payment on principal which statement is true? monthly payments will steadily decrease over the life of the term most of the amount paid on the loan will apply the interest owed most of the amount paid on the loan will apply to the principal owed monthly payments will steadily increase over the life of the term why is a loan is structured to pay

a loan is structured to pay back higher portions of interest first and gradually increase principal payments. this benefits the ... lender borrower loan amount $200,000 loan term 30 years interest rate 6% monthly payment $1,199.10 annual payment $14,389.20 54% payment on interest 46% payment on principal which statement is true? monthly payments will steadily decrease over the life of the term most of the amount paid on the loan will apply the interest owed most of the amount paid on the loan will apply to the principal owed monthly payments will steadily increase over the life of the term why is a loan is structured to pay

Answer

Brief Explanations:

  1. For the first question, when a loan is structured to pay higher - portions of interest first and gradually increase principal payments, the lender benefits. This is because the lender receives more of the interest (which is their profit) earlier in the loan term, reducing the risk of non - payment and ensuring a return on their investment.
  2. For the second question, with a loan structured to pay a higher percentage (54%) on interest and 46% on principal, most of the amount paid on the loan will apply to the interest owed. As the loan progresses, the proportion of principal payment increases, but initially and over a significant part of the loan term, interest payments are higher.

Answer:

  1. A. lender
  2. B. most of the amount paid on the loan will apply the interest owed