Georgia Multiple Listing Service (MLS) Exam 2025 – 400 Free Practice Questions to Pass the Exam

With a fully amortized mortgage, the structure of the payments is designed to ensure that, by the time the loan reaches its maturity date, the borrower has paid off both the principal and the interest in equal monthly installments over the loan term. This means that the total amount borrowed (the principal) will be completely repaid by the end of the loan period, along with the interest accrued during that time.

The process of amortization spreads the repayment of the loan into manageable monthly payments, which include both the interest cost and a portion of the principal. Over time, as payments are made, the balance of the principal decreases, and the portion of the payment that goes toward interest decreases as well. Consequently, at loan maturity, there is no remaining balance and the principal is fully paid off, which is the defining characteristic of a fully amortized mortgage.

This clarity about how the payments work is why the outcome at the end of a fully amortized mortgage is that there is no remaining balance due—both principal and interest have been entirely paid.