Finance
An 'amortized loan' in NC means the loan is repaid through:
AA single lump sum at the end of the term
BRegular periodic payments that include both principal and interest, gradually paying off the balance✓ Correct
CInterest-only payments for the full term
DPayments that increase each year
Explanation
Amortization is the process of gradually paying off a loan through regular payments that cover both interest (calculated on the remaining balance) and principal, until the loan is fully paid off.
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Key Terms to Know
Amortization
The gradual repayment of a loan through scheduled periodic payments that cover both principal and interest.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Fiduciary DutyThe highest legal duty an agent owes to a principal — requiring the agent to act in the principal's best interest above all others.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Math Concepts
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