What is an Additional Principal Payment (on Mortgage Loans)?

Additional principal payments are loan payments made by the borrower in excess of the payment due. That excess is applied directly toward the principal balance.

By reducing the principal balance faster than originally structured by the loan’s amortization schedule, the borrower can reduce the time required to pay off the loan as well as the interest charges during the entire loan term.

For more information, see also the following entries:

• :Amortization:
• :Amortization Schedule:
• :Borrower:
• eed of Trust:
• :Interest:
• :Interest Rate:
• :Monthly Payment:
• :Mortgage:
• :Mortgage Loan:
• rincipal:
• rincipal Balance:
• :Term: