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What is the difference between making a regular payment to a loan or applying a payment to only principal?
Wiki User
∙ 13y ago
Generally, an unscheduled loan has interest compounded at the end of a time period (in most cases a month, sometimes a week.) When you make a loan payment, you are generally paying both accrued interest and principal debt. When you pay only to the principal, you are paying back the original amount without interest.
This is done by people in order to reduce future interest payments.
Wiki User
∙ 13y ago
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A Balloon payment is a lump sum of principal reduction due at the maturity of the loan. I have no idea how itcompares to a deposit as a deposit is usually a transaction when money is put into a savings/checking account which is a totally different side of the bank...
What is mortgage principal curtailment?
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