- negative amortization
See: capitalized interestCategory: Personal Finance & RetirementCategory: Real Estate & Rental Property → Buying a House
Nolo’s Plain-English Law Dictionary. Gerald N. Hill, Kathleen Thompson Hill. 2009.
- negative amortization
USAAn increase in a loan balance, especially in an adjustable rate mortgage (ARM). Some ARMs permit the interest rate to change without any relation to a minimum payment requirement. When a borrower makes a minimum payment that does not cover all interest due under a current interest rate, the interest payment is deferred. The deferred interest is tacked onto the loan balance, which negatively amortizes as a result.
Practical Law Dictionary. Glossary of UK, US and international legal terms. www.practicallaw.com. 2010.
Look at other dictionaries:
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