Amortization

Amortization Definition (in the Accounting Vocabulary)

The New York State Society of Certified Public Accountants offers the following definition of Amortization in a way that is easy for anybody to understand: Gradual and periodic reduction of any amount, such as the periodic writedown of a BOND premium, the cost of an intangible ASSET or periodic payment Of MORTGAGES or other DEBT.

United States Tax Concept of Amortization

The term amortization has multiple meanings. It’s the gradual reduction of a debt by means of equal periodic payments sufficient to meet current interest and liquidate the debt at maturity. It’s also an expense allowed as a means of spreading the cost of an intangible asset over a period of years.

Concept of Amortization in the context of Real Property

A short definition of Amortization: Payment of a debt in equal periodic installments of principal and interest. See also: Balloon Note; Straight Note; Negative Amortization.

Concept of Amortization in the context of Real Property

A short definition of Amortization: Payment of a debt in equal periodic installments of principal and interest. See also: Balloon Note; Straight Note; Negative Amortization.