amortize

[ˈæmərtaɪz]

amortize Definition

• 1. gradually write off the initial cost of (an asset) over a period
• 2. reduce or extinguish (a debt) by money regularly put aside

Using amortize: Examples

Take a moment to familiarize yourself with how "amortize" can be used in various situations through the following examples!

• Example

  The company plans to amortize the cost of the new equipment over five years.

• Example

  He is amortizing his student loans by making monthly payments.

• Example

  The mortgage will be amortized over a period of 30 years.

amortize Synonyms and Antonyms

Synonyms for amortize

• clear
• settle
• pay off
• liquidate

Antonyms for amortize

• capitalize

Phrases with amortize

• amortization schedule

  a table showing the amounts and timing of loan repayments, including interest and principal

  Example

  The bank provided an amortization schedule for the mortgage.

• fully amortized loan

  a loan that is completely paid off by the end of the loan term

  Example

  The borrower opted for a fully amortized loan with fixed monthly payments.

• negative amortization

  an increase in the principal balance of a loan caused by making payments that do not cover the interest due

  Example

  The borrower was surprised to learn that their monthly payments were not enough to cover the interest, resulting in negative amortization.

Origins of amortize

from Old French 'amortir', meaning 'to kill, subdue'

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Summary: amortize in Brief

'Amortize' [ˈæmərtaɪz] means gradually writing off the initial cost of an asset or reducing/extinguishing a debt by making regular payments. It is commonly used in financial contexts, such as mortgages and loans. Phrases like 'amortization schedule' and 'fully amortized loan' refer to specific aspects of loan repayment. 'Negative amortization' occurs when payments do not cover the interest due, leading to an increase in the principal balance.