How is the Principal Payment determined on a loan

[Shafi Noss]

Hi everyone,

I have a question about how much in excess of the interest is paid in each payment of a fixed rate loan. Suppose you have a 100k loan at 6%. An example from investopedia shows a schedule of

Payment

001: Principal($99.55)____Interest($500.00)___Principal Balance($99,900.45)  

180: Principal($243.09)___Interest($356.46)___Principal Balance($71,048.9?)  

360: Principal($597.00)___Interest($2.99)_____Principal Balance($0)

I'm having trouble understanding how the initial principal payment is determined. The initial $500 interest payment makes sense: 100k at 6% divided into 12 months. I'm assuming that's how the math works out to have the loan paid in 30 years and keeping an even $600 paid every month. Is that right?

I'm also curious if this sort of paydown schedule yields any tricks for smart investing. For example, the principal paydown is slow at the beginning, but speeds up. Does that mean loan amortization only becomes a significant part of your investment returns after a certain inflection point, does that change for other loan terms or interest rates? Anything you feel is really valuable to know about loan paydowns that may not be obvious?