stepped lending
finance
Quick Summary
Stepped lending, also known as a partially amortized loan, involves a repayment structure where borrowers make small monthly payments while interest accrues on the remaining balance. This causes the final payment, due at the end of the loan period, to be significantly larger, much like a balloon. This is in contrast to a fully amortized loan, where each payment consists of a fixed amount of principal and interest, gradually paying down the loan over time.12
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