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Saredam t1_ixxvyvb wrote

Reply to comment by tth2o in Delayed Mortgage Monthly Payment at WF by gundamstar1

Not sure what country you’re from but FYI the vast majority of traditional American mortgages do not accrue interest monthly at this time. Most often, at the point the mortgage is closed, the entire payment schedule including principal and interest is dictated at that time. You’re paying off more principal and less interest every month.

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tth2o t1_ixz3bby wrote

While it might look that way, the interest is recalculated at month end on most mortgages in the US. The amortization schedule is set at the beginning based on the MINIMUM payment expected to align with the term of the note. This allows them to charge correct interest on the note regardless of payment behavior (over or under paying changes interest owed). This is why overpaying is advisable, it reduces the total interest you'll pay over the life of the loan.

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