Amortizing Loan Costs
Contents Standard loan repayment costs. Loan repayment costs. Required mortgage insurance. arm Short term loan calculator. short term Loan costs may include legal and accounting fees, registration fees, appraisal fees, processing fees, etc. that were necessary costs in order to obtain a loan. If the loan costs are significant, they must be amortized to interest expense over the life of the loan because of the matching principle. For instance, assume you take out a five-year loan and pay $5,000 in fees. A straight-line method would have you amortize $1,000 each…
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