This is absolutely true for an annuity mortgage! I was talking about (here in The Netherlands, don’t know if you have something likewise??) the fixed principle repayment mortgage where I repay the same principle amount every month and where the interest payments decrease over time.
The principle would apply for both kind of mortgages though but in you’re example you could “only” get 9.6K out of the property without any appreciation.
The fixed principal loan is not offered in our US markets. Let me revise my earlier comment.
Loan amortization is not as linear in the USA as you might experience in the Netherlands.
The fixed principal loan would only appeal to US consumers who keep their homes forever and eventually pay off their loans. Although the total cost of financing would be lower pver the life of the loan than with the loan structure we have, most US borrowers would find their monthly mortgage payments less affordable with the fixed princpal mortgage.
For example, the $100K loan at 6% paid back over thirty years will cost the US borrower $600 per month, each month for the life of the loan. Since the average US borrower sells their home every five to seven years, so they are looking for the lowest monthly payment they would have to make in order to live in the most expensive house they can afford. If a fixed principal loan were used to finance the home purchase, the US borrower’s first monthly payment for the same loan would be $778. The family that can only afford $600 each month will have to settle for a smaller home, or purchase in a less desirable neighborhood.