Loan Glossary
Plain-English definitions for every term you'll encounter in the loan process
Showing 2 terms
in General starting with A
A
Amortization
GeneralThe process of paying off a loan through regular payments over time. Each payment covers both interest and principal, with the interest portion decreasing and the principal portion increasing as the balance declines.
Annual Percentage Rate (APR)
GeneralThe true yearly cost of borrowing, expressed as a percentage. APR includes the interest rate plus fees (origination, points, mortgage insurance), making it more accurate than the stated interest rate for comparing loan offers.