When a bank loans you money to buy a house, that debt is called a mortgage. They print up a table (like the one below but longer) showing all your monthly payments, the interest being charged & the principal (the balance of the original loan). That's called an Amortization Table. Here, your annual interest rate is 8%, which means a monthly rate of .667% because the total amount of annual interest you owe the bank is divided into 12 equal payments. So each month your payment inclues paying back a portion of the principal plus interest charged by the bank for allowing you to use their money. Please take a look at your first six months of payments & fill in the blanks:

Payment Number	Balance of Loan	Interest (.00667 x Balance)	Payment	New Balance (Copy to Next Line)	Interest as Percent of Payment (Interest/Payment x 100%)
	$120,000.00		$880.80
			$880.80
			$880.80
			$880.80
			$880.80
			$880.80

So how about interest? It really racks up. Answer the following questions.

1. What's happening to the amount of interest you're paying each month?






2. When do you think you'd break 50%? 25%? Please explain your reasoning.






3. What do you think would happen to the interest if you cut the term of the loan to 15 years? to 10? Please note your rationale.