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this post was submitted on 10 Sep 2025
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Personal Finance
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Yes, this is how interest works and how lenders make money. It's a lot.
The lessons are:
Pay a little bit more every month (applied to principal) to the effect of 1 additional monthly payment a year or more. It will dramatically reduce your overall interest and length of loan.
You're talking about a long loan, during that time rates will rise and fall. When they fall, you refinance at a lower rate. Don't extend your loan longer (don't take another 30 year loan after you've lived there 5 years, take a 25 year loan). That will give you the best market results for something you can't control.
Glad you mentioned that, I completely forgot to bring that up.