How do mortgage payments go up if it’s a loan?
In: Economics
You’re getting contradictory answers because the way mortgages are done varies by country. In the USA, most mortgages have a fixed interest for the length of the loan. The payment for the loan won’t change over the term of the loan. The amount of your payment that goes to interest versus principle changes over the length of the loan. Look up an amortization schedule to see how it exactly works out.
Most places have property tax that you’ll have to pay, and most loans require insurance to protect the property and you’ll have to pay that too. Some banks let you do that on your own, buy others require escrow and then they pay on your behalf. Since taxes and insurance can vary in price, the amount you’d pay for these can change.
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