Finance
Amortization in a mortgage loan refers to:
AThe gradual repayment of the loan through scheduled principal and interest payments over time✓ Correct
BThe process of increasing the loan balance over time
CPaying off the loan in one lump sum
DSkipping mortgage payments during hardship
Explanation
Amortization is the process of gradually paying off a loan through regular scheduled payments that include both principal and interest. Early payments are mostly interest; later payments include more principal. A fully amortizing loan has a zero balance at the end of the term.
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