amortization

American  

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

noun

• amortizations
  plural

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

Inflected Forms

Nouns

• amortizations
  plural

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

See Examples For:

amortization amortizations

Maersk said it now targets underlying earnings before interest, taxes, depreciation, and amortization for the year of between $10.5 billion and $12.5 billion, ahead of its previous target range of $8 billion to $10 billion.

From The Wall Street Journal ● Aug. 13, 2026

Operating profit before depreciation, amortization, and impairment losses fell to 5.42 billion kroner from 6.64 billion kroner in the year-earlier period.

From The Wall Street Journal ● Aug. 13, 2026

Core revenue, which strips out certain items including stock-based compensation, customer warrant amortization, and data-center pass through revenues and costs, more than doubled to $209.9 million.

From The Wall Street Journal ● Aug. 12, 2026

Management projected an adjusted loss before interest, taxes, depreciation and amortization of between $17 million and $23 million, while Wall Street had expected a $10 million loss.

From MarketWatch ● Aug. 10, 2026

These bearer bonds carry interest at 2-1/2 per cent per annum from 1921 to 1925, and at 5 per cent plus 1 per cent for amortization thereafter.

From The Economic Consequences of the Peace by John Maynard Keynes

Pemex is the most heavily indebted oil company in the world, facing some $110.5 billion in debt and hefty amortizations in 2024.

From Reuters ● Oct. 20, 2023

Both banks had no variable-rate mortgages with amortizations greater than 30 years prior to the start of rate hikes.

From Reuters ● Jun. 27, 2023

The government has already taken measures to restrain the housing market, including reducing amortizations and requiring stricter criteria for mortgage qualifications.

From BusinessWeek ● Feb. 13, 2012

Bank of Montreal’s mortgage offer is limited to 25-year amortizations to ensure consumers pay off their loans faster, the lender said.

From BusinessWeek ● Jan. 17, 2012

One thinks of time in terms of production schedules and amortizations, the other in terms of incumbencies and election days.

From Time Magazine Archive

Related Words

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