What does amortise mean?
Amortise is a financial term that refers to the process of paying off a debt or loan gradually, typically by making regular payments over a set period of time. This can be done through a variety of methods, including monthly payments or lump sums. In finance, amortise is often used to describe the process of paying off a loan or debt over time. It can also refer to the gradual reduction of an asset's value over its useful life. The term is commonly used in accounting and finance to describe the process of spreading out the cost of an asset over its useful life. Amortise can also refer to the process of paying off a mortgage or other type of loan. In this context, it refers to the gradual reduction of the outstanding balance over time. Overall, amortise is an important concept in finance and accounting, and is used to describe the process of paying off debts and loans over time.
verbTo pay off or discharge (a debt, loan, or other financial obligation) gradually, typically by making regular payments over a set period of time.
- To pay off or discharge (a debt, loan, or other financial obligation) gradually, typically by making regular payments over a set period of time.
"The company will amortise the loan over 10 years, making monthly payments of $10,000."
"The company will amortise the loan over 10 years, making monthly payments of $10,000."
"The government will amortise the cost of the new infrastructure project over several decades."
The plural form of amortise is used when referring to multiple debts or loans being paid off over time.
"The company will amortise several loans over the next 5 years."
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Etymology of amortise
The word amortise comes from the French word 'amortir', which means 'to kill' or 'to destroy'. However, in the context of finance, the term has taken on a different meaning, referring to the process of paying off a debt or loan gradually. The term is believed to have originated in the 15th century, when it was used to describe the process of paying off a mortgage or other type of loan.
How amortise is actually used
In finance, amortise is often used to describe the process of paying off a loan or debt over time. It can also refer to the gradual reduction of an asset's value over its useful life.