FinancingInterest_and_payment_calculationsMEDIUM
Camila Ortiz has an amortizing loan balance of $250,000 at 6% interest. Her scheduled monthly principal-and-interest payment is $1,498. How much of the first payment goes to principal?
Correct Answer
A) $248
Step 1: First-month interest = $250,000 × 6% ÷ 12 = $1,250. Step 2: Principal portion = $1,498 − $1,250 = $248. In an amortizing loan, the part of the payment above interest reduces principal, so $248 goes to principal.
Answer Options
A
$248B
$208C
$228D
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Related Topics & Key Terms
Key Terms:
amortizationprincipal_portioninterest_portionmonthly_payment
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