Vocabulary: Amortization

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Amortization.png

Vocabulary: Amortization

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๐Ÿ“– Real Estate Vocabulary: Amortization ๐Ÿก๐Ÿ’ฐ

Amortization is the process of gradually paying off a loan balance over time through scheduled mortgage payments. Each payment includes both principal (the original loan amount) and interest (the cost of borrowing).

๐Ÿ”น At the beginning of the loan, more of your payment goes toward interest.
๐Ÿ”น Over time, a larger portion applies to the principal, building equity in your home.
๐Ÿ”น Most home loans follow a set amortization schedule, helping buyers understand how their payments contribute to owning their home outright.

Understanding amortization is key to making smart mortgage decisions! ๐Ÿ’ก Have questions about financing your dream home? Let's chat! ๐Ÿ“ฉ

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