NEGATIVE AMORTIZATION


Meaning of NEGATIVE AMORTIZATION in English

A loan repayment schedule in which the outstanding principal balance of the loan increases, rather than amortizing , because the scheduled monthly payments do not cover the full amount required to amortize the loan. The unpaid interest is added to the outstanding principal , to be repaid later.

Campbell R. Harvey. Hypertextual finance English glossary.      Английский словарь гипертекстовых финансов.