amortizing mortgage

amortizing mortgage
A mortgage in which all the principal and all the interest has been repaid by the end of the mortgage agreement period. Although equal payments may be made during the term of the mortgage, the sums are divided, on a sliding scale, between interest payments and repayments of the principal. In the early years most of the payments go towards the interest charges, while in later years more repays the sum borrowed, until this sum is reduced to zero with the last payment. Compare balloon mortgage

Big dictionary of business and management. 2014.

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