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:
“The principal difference between love and hate is that love is a irradiation, and hate is a concentration. Love makes everything lovely; hate concentrates itself on the object of its hatred.”
—Sydney J. Harris (b. 1917)
“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)