formal10K+

Amortisation

UK //ˌæmɔːtəˈzeɪʃən//US //ˌæmɔːrtəˈzeɪʃən//

Definition

The process of gradually paying off a debt through regular payments.

In simple words: The process of paying off a debt gradually over time.

Examples

The bank offers a detailed plan for the amortisation of your loan.
Understanding the amortisation schedule can help you manage your expenses better.
Amortisation will reduce the overall interest paid on the mortgage.
They calculated the amortisation of the asset over five years.
She was confused about the amortisation process but soon learned how it worked.

Usage notes

Used in financial contexts, often in discussions about loans and investments. Not common in everyday conversation.

Grammar pattern

amortise + object

Memory hint

Think of 'a-mort-gage' - a mortgage is often amortised over many years.

Collocations

amortisation schedule
amortisation period
amortisation process
amortisation table
amortisation expense

Synonyms

repayment
payment
settlement
liquidation
discharge

Common mistakes

Confused with 'amortization' - the British spelling is 'amortisation'.
Using it in informal contexts where simpler terms are preferred.
Misunderstanding it as instant payment instead of gradual.