An amortized loan is a loan that requires equal payments over its life; its payments include both interest and repayment of the debt.

Question

Quizplus · Accepted Answer

An amortized loan is structured so that the payments made over the life of the loan are equal and include both interest and repayment of the debt. This is different from other types of loans, such as interest-only loans, which only require payments toward the interest and do not reduce the principal balance of the loan.

An Amortized Loan Is a Loan That Requires Equal Payments