Amortization
Loans
Definition
The process of gradually paying off a loan through regular instalments that include both principal and interest. An amortization schedule shows how each EMI payment is split between interest and principal repayment over the loan tenure.
Example
In a Rs 50 lakh home loan over 20 years at 8.5%, initial EMIs pay mostly interest, but as the loan matures, a larger portion goes towards principal repayment.
Related Calculators
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