Fully amortizing payment

Definition

The monthly mortgage payment which, if maintained unchanged through the remaining life of the loan at the then-existing interest rate, will pay off the loan over the remaining life.

See Mortgage Amortization: How Does It Work?

On FRMs the payment is always fully amortizing, provided the borrower has made no prepayments.

(If the borrower makes prepayments, the monthly payment is more than fully amortizing).

On GPMs, the payment in the early years is always less than fully amortizing.

On ARMs, the payment may or may not be fully amortizing, depending on the type of ARM

Related Terms

Other terms related to 'Fully amortizing payment' starting with the letter 'F'

First mortgage, Fees, Fixed rate mortgage FRM, Financing points, Float down

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