Principal balance, in regard to a mortgage or other debt instrument, is the amount due and owing to satisfy the payoff of the underlying obligation.
Amortized mortgage loans automatically pay a portion of each monthly payment to the principal balance with the rest being paid as interest.
An interest-only loan does not require any monies be paid toward the principal balance each month, but is allowable.
Famous quotes containing the words principal and/or balance:
“In our country today, very few children are raised to believe that their principal destiny is to serve their family, their country, or God.”
—Benjamin Spock (b. 1903)
“Forget dating. Forget striking a balance between work and family. Most single parents, whether they are divorced, widowed, or single by choice, report that discipline is by far the toughest issue.”
—Jean Callahan (20th century)