Why is interest on a loan payment deducted from the balance of the loan?

emikej

This is the first payment on a new mortgage account I set up. I split the principal & interest in categories, but the balance reflects the full amount of payment.

NotACPA

In the split payment, what categories are used for:

1. Transfer of principal to the loan (to reduce loan amount)
2. Expense of interest
3. Any other amounts in the payment (such as escrow)

NotACPA

In the split payment, what categories are used for:

1. Transfer of principal to the loan (to reduce loan amount)
2. Expense of interest
3. Any other amounts in the payment (such as escrow)

emikej

Thanks. I split the payment and only transferred the principal. All is well.