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:

    It is perhaps the principal admirableness of the Gothic schools of architecture, that they receive the results of the labour of inferior minds; and out of fragments full of imperfection ... raise up a stately and unaccusable whole.
    John Ruskin (1819–1900)

    Revolution, in order to be creative, cannot do without either a moral or metaphysical rule to balance the insanity of history.
    Albert Camus (1913–1960)