What principle does NOT generally apply to a level payment mortgage?

In a level payment mortgage, the principle that total loan cost increases as payments are delayed does not generally apply. This is because in a level payment mortgage structure, the borrower is expected to make consistent monthly payments that cover both principal and interest over the life of the loan.

When payments are made on time, the total cost of the loan is stable, as the borrower is paying down both interest and the principal according to a pre-established schedule. However, if payments are delayed, this can lead to additional fees or interest charges; however, this does not reflect the inherent structure of a level payment mortgage, which is designed to allow consistent monthly payments.

In contrast, the first principle highlights that the monthly payments remain the same throughout the loan term, which is a hallmark of level payment mortgages. The second principle indicates that as the borrower makes payments, the interest component of each payment decreases over time because the principal balance lowers. Lastly, the maturity period of the loan is established upfront, meaning the duration of the loan is predetermined and follows a set repayment plan. Therefore, the idea that total loan cost inherently increases due to payment delays is not a fundamental aspect of level payment mortgages.