Apr 22 , 2016
Definition: a financing arrangement in which the monthly mortgage payments are less than required to pay both interest and principal. The unpaid balance is added to the loan balance.
Pronunciation: \ˈne-gə-tiv\ \ˌa-mər-tə-ˈzā-shən also ə-ˌmȯr-\
Used in a Sentence: Negative amortization occurs when the mortgage payments are not large enough to cover the interest expense.