negative amortization: Meaning and Definition of

neg'ative amortiza'tion

Pronunciation: [key]
  1. the increase of the principal of a loan by the amount by which periodic loan payments fall short of the interest due, usually as a result of an increase in the interest rate after the loan has begun.
Random House Unabridged Dictionary, Copyright © 1997, by Random House, Inc., on Infoplease.