Real Estate Investing
Interest-Only Loan
Definition
What is Interest-Only Loan?
A loan requiring only interest payments for a period, with principalThe original amount of money invested or lent, excluding later returns. due later.
Example in practice
How This Looks in Practice
The borrower pays interest for three years before principal amortisationThe systematic allocation of an intangible asset's cost over its useful life. begins.
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Related Terms
Real Estate Investing
Real Estate
Land and buildings held for use, rental income, development, or appreciation.
Real Estate InvestingResidential Property
Property designed mainly for people to live in.
Real Estate InvestingCommercial Property
Property used for business purposes, such as offices, shops, or warehouses.
REIT MetricsFunds from Operations
A REIT performance measure that adjusts net income for real-estate depreciation and certain property-sale gains.