Mortgage Amortization
Mortgage amortization is how each monthly home payment splits between paying off what you owe and paying the bank's fee.
Think of it this way
Each month, you pour a jug of water into two bowls. At first, most water goes into the fee bowl. Only a little fills the debt bowl. Over time, the split shifts so the debt bowl gets more and the fee bowl gets less.
Explaining mortgage amortization by grade level
When you buy a home, you pay a little each month. At first, most of your money goes to the bank as a fee. Over time, more of your money goes toward owning the home. It works like paying off a big tab bit by bit.