How Principal & Interest Are Applied In Loan

Understanding how principal and interest are applied in loan payments is crucial for managing your finances effectively. This video by Real Estate Finance Academy breaks down these concepts clearly, making it easier for you to grasp the details. Here’s what you’ll learn:

  • Basics of Loan Payments: Real Estate Finance Academy will explain the fundamental components of a loan payment, including principal and interest, and how they work together.
  • Amortization Explained: Learn about the amortization process and how it impacts your loan payments over time, with a focus on the distribution between principal and interest.
  • Calculation Examples: See real-world examples that illustrate how loan payments are calculated, helping you understand the practical application of these concepts.
  • Strategies for Managing Loans: Get practical tips on how to manage your loans effectively, including strategies for paying off your principal faster and reducing the amount of interest you pay over the life of the loan.


By the end of this video, you’ll have a solid understanding of how principal and interest are applied in loan payments and how to use this knowledge to your advantage. Let’s dive in and take control of your loan management!


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