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:
“With a balanced combination of the two principal energies from mother and father, a girl can both be in touch with her womanly strengths and be a powerful force in the world—strong and nurturing, decisive and caring, goal- oriented and aware of the needs of others. She has the courage to voice what she thinks and feels and the strength to follow her destiny.”
—Jeanne Elium (20th century)
“Action is at bottom a swinging and flailing of the arms to regain one’s balance and keep afloat.”
—Eric Hoffer (1902–1983)