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:
“God should not be called an individual substance, since the principal of individuation is matter.”
—Thomas Aquinas (c. 12251274)
“Daily life is governed by an economic system in which the production and consumption of insults tends to balance out.”
—Raoul Vaneigem (b. 1934)
Related Phrases
Related Words