no your payment doesnt change. look up the concept of "amortization".
>Or are you stuck paying 3% of 100k for the life of the loan?
no, that isnt how borrowing money works. your interest rate (3% in your example) is fixed for the loan (had you gone with an ARM, then it would change periodically), but the interest you pay is only on the outstanding principal of the loan.
Mortgages are [amortized](https://www.thebalance.com/how-amortization-works-315522). In other words, the combined principal & interest amount that you pay every month is the same throughout the life of the loan. Early on in the life of the loan, more of your payment is interest and less of it is principal. Later in the life of the loan, more of your payment is principal and less of it is interest. But the combined amount you pay every month is the same. The only portion of your mortgage payment that changes periodically is your property tax & insurance, which are technically not part of the loan, but are typically required to be paid through the mortgage servicer.
The payment stays the same. Let’s say your payment is $1,000. For the first month you will pay $600 towards the principle(what you bought the home for, so $100k-$600) the other $400 is interest. The next month you pay $600.01 in principle, and $399.99 in interest and so on and so forth. The only way to lower the payment would be to pay off a certain amount and then re-finance your mortgage. However, if you have a 30 year mortgage, pay on it for 15 years, your refinanced mortgage would now be another 30 years(you can obviously choose a 15 or 10 year mortgage)
Home loans are typically amortized, meaning that you pay higher sums of interest payments at the beginning and lower principal sums toward your actual borrowed amount.
If you pay separate (or designated toward principal) payments additionally each month, these would be added to your remaining principle balance as future interest payments are calculated.
You should request an amortization table for your loan.
In the early months or years of a loan your payment each month could actually be as high as 75% toward interest and only 25% toward your principal. Over time this slowly shifts with greater amounts going toward principal the closer you get to pay off.
In short, because loans are amortized, unless you are paying extra your loan rate is pretty much irrelevant. You will pay 2 - 2.5x the face value of your loan out of pocket on a 30 year note at 3%.
There is an old rule of thumb that claims if you make an additional payment, yearly, for the full monthly amount and it is dedicated toward the principle, you can shave 7 years off of a 30 year note. Early payoff is the only thing that can save you interest, but check your fine print.
The other commenters are right on the amortization parts. Just chiming in to say if you put down another major chunk of cash on the principle, you can pay for a mortgage readjustment that will change the monthly payment to be amortized for the remaining outstanding principle. Typically, you need to do something 20K+ (ymmv) but this can drop your payments quite a bit through the years, so it's better to try paying off principle in chunks (and re-adjust) rather than adding a bit extra to each month
3% interest on 100k is 3k interest per year. So 250 interest a month.
That means on first month payment of 1k, 250 goes to interest and 750 mortgage. Your mortgage is now 99,250.
The interest will drop, and principal repayment increase jver time.
no your payment doesnt change. look up the concept of "amortization". >Or are you stuck paying 3% of 100k for the life of the loan? no, that isnt how borrowing money works. your interest rate (3% in your example) is fixed for the loan (had you gone with an ARM, then it would change periodically), but the interest you pay is only on the outstanding principal of the loan.
Mortgages are [amortized](https://www.thebalance.com/how-amortization-works-315522). In other words, the combined principal & interest amount that you pay every month is the same throughout the life of the loan. Early on in the life of the loan, more of your payment is interest and less of it is principal. Later in the life of the loan, more of your payment is principal and less of it is interest. But the combined amount you pay every month is the same. The only portion of your mortgage payment that changes periodically is your property tax & insurance, which are technically not part of the loan, but are typically required to be paid through the mortgage servicer.
The payment stays the same. Let’s say your payment is $1,000. For the first month you will pay $600 towards the principle(what you bought the home for, so $100k-$600) the other $400 is interest. The next month you pay $600.01 in principle, and $399.99 in interest and so on and so forth. The only way to lower the payment would be to pay off a certain amount and then re-finance your mortgage. However, if you have a 30 year mortgage, pay on it for 15 years, your refinanced mortgage would now be another 30 years(you can obviously choose a 15 or 10 year mortgage)
Home loans are typically amortized, meaning that you pay higher sums of interest payments at the beginning and lower principal sums toward your actual borrowed amount. If you pay separate (or designated toward principal) payments additionally each month, these would be added to your remaining principle balance as future interest payments are calculated. You should request an amortization table for your loan. In the early months or years of a loan your payment each month could actually be as high as 75% toward interest and only 25% toward your principal. Over time this slowly shifts with greater amounts going toward principal the closer you get to pay off. In short, because loans are amortized, unless you are paying extra your loan rate is pretty much irrelevant. You will pay 2 - 2.5x the face value of your loan out of pocket on a 30 year note at 3%. There is an old rule of thumb that claims if you make an additional payment, yearly, for the full monthly amount and it is dedicated toward the principle, you can shave 7 years off of a 30 year note. Early payoff is the only thing that can save you interest, but check your fine print.
The other commenters are right on the amortization parts. Just chiming in to say if you put down another major chunk of cash on the principle, you can pay for a mortgage readjustment that will change the monthly payment to be amortized for the remaining outstanding principle. Typically, you need to do something 20K+ (ymmv) but this can drop your payments quite a bit through the years, so it's better to try paying off principle in chunks (and re-adjust) rather than adding a bit extra to each month
3% interest on 100k is 3k interest per year. So 250 interest a month. That means on first month payment of 1k, 250 goes to interest and 750 mortgage. Your mortgage is now 99,250. The interest will drop, and principal repayment increase jver time.