Everything else equal,the loan balance on a negative amortization loan will be less than that on an interest-only loan after the first year.

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A negative amortization loan allows the borrower to pay less than the interest due, and the unpaid interest is added to the loan balance. On the other hand, an interest-only loan requires the borrower to pay only the interest due, with no principal payments. Therefore, after the first year, the loan balance on a negative amortization loan will be higher than that on an interest-only loan.

Everything Else Equal,the Loan Balance on a Negative Amortization Loan