Self Amortizing Mortgage Law and Legal Definition
Self amortizing mortgage is a mortgage in which the mortgagor pays the interest as well as a portion of the principal in the periodic payment. It is a residential mortgage in which the loan is fully paid over a scheduled time period, usually fifteen or thirty years, through regular payments of principal and interest.
Under self amortizing mortgage, the borrower need not make a lump-sum balloon payment at the end of the mortgage. Lenders usually provide amortization tables showing exactly how much principal and interest are paid over the full term of the loan.
Self amortizing mortgage is also termed as self liquidating mortgage.