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Negative Amortization
What does it mean?
An increasing value of the principal of a loan resulting from re-payment amounts being smaller than interest accrued.
In Other Words...
When interest charges exceed the payments made, remaining amounts are added to the principal of the loans. This is one of the sources of earnings for credit card companies.
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Related Terms
Amortization | Interest | Loan | Mortgage | Principal
1 |
A | B |
C | D |
E | F |
G | H |
I | J |
K | L |
M | N |
O | P |
Q | R |
S | T |
U | V |
W | X |
Y | Z
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