When a loan is paid off in equal installments,this is called a(n)________ loan.
A)amortized
B)discounted
C)balloon
D)reverse annuity
E)none of the above

Question

Quizplus · Accepted Answer

An amortized loan is a loan that is paid off in equal installments, which includes both principal and interest, over a set period of time. This is the most common type of loan and allows borrowers to know exactly how much they need to pay each month until the loan is fully paid off. Discounted loans are those that are offered at a lower interest rate than the market rate, while balloon loans require a large lump sum payment at the end of the loan term. Reverse annuity is not a type of loan.

When a Loan Is Paid Off in Equal Installments,this Is