amortization

American  

[am-er-tuh-zey-shuhn, uh-mawr-] / ˌæm ər təˈzeɪ ʃən, əˌmɔr- /

noun

1. an act or instance of amortizing a debt or other obligation.

2. the sums devoted to this purpose.

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amortization British  

/ əˈmɔːtɪzmənt, əˌmɔːtaɪˈzeɪʃən /

noun

1. 1. the process of amortizing a debt

   2. the money devoted to amortizing a debt

2. (in computing the redemption yield on a bond purchased at a premium) the amount that is subtracted from the annual yield Compare accumulation

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amortization Cultural  

1. A term that refers either to the gradual paying off of a debt in regular installments over a period of time or to the depreciation of the “book value” (that is, the standard assessed value) of an asset over a period of time.

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Other Word Forms

Derived Forms

• amortizement
  noun

Etymology

Origin of amortization

First recorded in 1665–75, amortization is from the Medieval Latin word a(d)mortizātiōn- (stem of admortizātiō ). See amortize, -ation

Explanation

Amortization means a debt is being paid off by a series of payments. An amortization schedule for your car loan will show exactly how much you owe and how long it’ll take to pay it. Amortization is fancy way to describe a payment plan: you gradually pay off a specific amount by making small payments according to a set schedule. Amortization takes place over a specific period of time. The root of amortization can be traced to the Middle English word amortisen, meaning “to kill.” In this case, it’s a debt that’s being killed off — slowly, over time. The word is often applied to car or home loans.

Example Sentences

Baron last week said he expects SpaceX’s Starlink business alone to generate “about a trillion dollars” in annual revenue, as well as earnings before interest, tax, depreciation and amortization of $800 billion, within 10 years.

From MarketWatch • Jun. 9, 2026

The company also said it expects adjusted earnings before interest, taxes, depreciation, and amortization to fall between $120 million and $125 million, up from a range of $85 million to $100 million.

From The Wall Street Journal • Jun. 9, 2026

It does generate positive earnings before interest, taxes, depreciation, and amortization, or Ebitda.

From Barron's • Jun. 3, 2026

Adjusted earnings before interest, taxes, depreciation and amortization are forecast to come in between $225 million and $235 million, versus prior guidance for $230 million to $245 million.

From The Wall Street Journal • Jun. 2, 2026

Now some of them are for longer periods and provide for monthly amortization charges by which the mortgage is paid in full by the end of the time specified.

From If You're Going to Live in the Country by Lieberman, Frank

Related Words

• amount
• award
• cash
• deposit
• disbursement
• fee
• outlay
• pension
• premium
• refund
• reimbursement
• remittance
• reparation
• repayment
• restitution
• return
• reward
• royalty
• salary
• settlement