How is interest applied on an RV loan?
When you take out a 10 year RV loan, is the interest spread out equally across all the payments or is it mostly paid up front like a home mortgage?
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Most car loans use simple interest, a type of interest of which the interest charge is calculated only on the principal (i.e. the amount owed on the loan).
However, simple interest does not mean that every time you make a payment on your loan that you pay equal amounts of interest and principal. Instead, car loans are paid down via amortization, meaning you pay more interest at the beginning of your car loan than at the end.
Most car loans use simple interest, a type of interest of which the interest charge is calculated only on the principal (i.e. the amount owed on the loan).
However, simple interest does not mean that every time you make a payment on your loan that you pay equal amounts of interest and principal. Instead, car loans are paid down via amortization, meaning you pay more interest at the beginning of your car loan than at the end.
