Why is my monthly interest payment higher at the start of the loan?

I’m trying to understand my recent loan statement because I’m confused about why the interest portion of my monthly payment is so much higher right now compared to what I see listed for later months in the payment schedule. I specifically chose a fixed-rate loan expecting consistent payments each month, but when reviewing the breakdown, the interest charged at the start of the loan seems disproportionately high. This makes me wonder if there’s an error in the calculation or if this is standard for my type of loan—particularly since I signed up for a fixed-interest term with regular installments. Is this normal, and what causes the front-loading of interest like this?

In an amortizing loan, the monthly payment is fixed but consists of two components: interest and principal. The interest portion is calculated based on the outstanding loan balance at the beginning of each period. At the start of the loan, the outstanding balance is highest because little to no principal has been paid yet. Therefore, the interest accrued on this larger balance results in a higher interest payment. As payments progress, a larger portion of each payment reduces the principal balance. Consequently, the interest component decreases over time while the principal portion increases. This occurs because interest is computed as:
Interest Portion = Interest Rate per Period × Outstanding Principal Balance
Since the principal balance declines with each payment, the interest portion diminishes monthly. The fixed payment remains constant, ensuring the loan is fully paid by the end of the term. This structure is typical for mortgages, auto loans, and personal loans.