What is amoritzation?
The process of paying off a loan through specifically structured periodic payments is known as amortization. Amortized loans are different from other loans due to the way the amount and the structure of each payment is determined.
Mortgage payments are a common form of amortized loans, and interestingly enough, both the term mortgage and the term amortization find their meaning in the same root word "mort." This term means to deaden or kill, as in to "kill off" or eliminate the loan a bit at a time, via regular payments.
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