Mortgage whose entire principal is paid off in a specified period of time with regular interest and principal payments.
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A mortgage in which the holder pays for part of the principal and the interest each month. A self-amortizing mortgage differs from an interest-only mortgage, in which the holder does not make principal payments over the life of the mortgage. An advantage of a self-amortizing mortgage is the fact that the holder does not have to make a lump sum payment of the principal at maturity (or refinance at a potentially higher interest rate). However, self-amortizing mortgages have higher monthly payments than other mortgage types.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved
The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.