Introducing amortization


show more Introducing amortization provides you with in-depth training on Business. Taught by Curt Frye as part of the Excel 2007: Financial Analysis show less
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Introducing amortization

When you work with financial transactions, you will often encounter the term Amortization. It sounds complicated, but amortization is simply the gradual repayment of a debt in over time. Loans can be fully amortized, partially amortized, or negatively amortized. A fully amortized loan has payments that will pay off the entire principal and accumulated interest at the end of the loan's term. A partially amortized loan has payments that will pay off only a portion of the principal and accumulated interest. Many such loans have a large payment called a balloon payment after a set number of years.

In the case of a home loan, which usually runs 30 years, a borrower might have a balloon payment due at the end of the 15th year. You can also have balloon payments due at the end of loan's term. As an example of how amortization works, let's take a look at the example in the worksheet. So we have a $25,000,000 loan, probably not a home loan, at the rate of 4.9%, and it is going to be p...

Introducing amortization
Video duration: 2m 20s 2h 18m Intermediate

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Introducing amortization provides you with in-depth training on Business. Taught by Curt Frye as part of the Excel 2007: Financial Analysis

Subject:
Business
Software:
Excel
Author:
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