This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. This episode covers content for the National Real Estate Exam.

In this episode you will learn:

• Amortization is the systematic liquidation of debt through regular installments of principal and interest.

• In the early stages of a loan, the majority of the monthly payment is allocated to interest rather than principal.

• A fully amortized loan results in a zero balance at the end of the term with no large final payment required.

• Calculating principal reduction requires finding the monthly interest first by dividing the annual interest by twelve.

• Partially amortized loans require a balloon payment because the regular payments do not cover the full principal balance.

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