Principal Balance

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:

    “Silence, indifference and inaction were Hitler’s principal allies.”
    —Immanuel, Baron Jakobovits (b. 1921)

    “The perfect aphorism would achieve classical balance and then immediately upset it.”
    —Mason Cooley (b. 1927)