When you take out a loan, you are required to make monthly payments to repay the loan. In the beginning, you may find that most of your monthly payment goes towards interest, and only a small portion goes towards the principal. This is because in the beginning, you owe more interest, because your loan balance is still high. Over time, as you pay down the principal, you owe less interest each month, because your loan balance is lower.

# Why Am I Paying More Towards Interest Than Principal?

When you take out a loan, you are required to make monthly payments to repay the loan. The amount of interest you owe is based on the amount of the loan and the interest rate. The more you borrow, the more interest you owe. In the beginning, you owe more interest, because your loan balance is still high. So most of your monthly payment goes to pay the interest, and a little bit goes to paying off the principal. Over time, as you pay down the principal, you owe less interest each month, because your loan balance is lower.

The amount of interest you owe is also affected by the interest rate. The higher the interest rate, the more interest you owe. So if you have a loan with a high interest rate, you will be paying more towards interest than principal.

In conclusion, when you take out a loan, you are required to make monthly payments to repay the loan. In the beginning, you owe more interest, because your loan balance is still high. So most of your monthly payment goes to pay the interest, and a little bit goes to paying off the principal. Over time, as you pay down the principal, you owe less interest each month, because your loan balance is lower. The amount of interest you owe is also affected by the interest rate. The higher the interest rate, the more interest you owe. So if you have a loan with a high interest rate, you will be paying more towards interest than principal.

# Questions & Answers

### Q: Why am I paying more towards interest than principal?

A: In the beginning, you owe more interest, because your loan balance is still high. So most of your monthly payment goes to pay the interest, and a little bit goes to paying off the principal. Over time, as you pay down the principal, you owe less interest each month, because your loan balance is lower. The amount of interest you owe is also affected by the interest rate. The higher the interest rate, the more interest you owe. So if you have a loan with a high interest rate, you will be paying more towards interest than principal.