DEFINITION of 'Accelerated Payments'
A term associated with making additional unscheduled payments on a loan at predetermined, or random intervals. Making additional unscheduled payments reduces the principal balance of the loan, meaning that more principal and less interest is paid off in subsequent payments. Making accelerated payments will lead to the early payoff of a loan.
BREAKING DOWN 'Accelerated Payments'
Most loans have an amortization schedule that defines how much principal and interest will be paid with each scheduled payment, so that the loan will be paidoff at the end of an established term.
Also, the amount of interest paid with each payment is a function of the remaining principal balance of the loan at that time. The higher the rate of interest on a loan, the more beneficial it can be to make accelerated payments. The faster the borrower applies accelerated payments toward the principal balance of a loan, the more interest that is saved.

Amortization Schedule
A complete schedule of periodic blended loan payments, showing ... 
Negatively Amortizing Loan
A loan with a payment structure that allows for a scheduled payment ... 
Amortized Loan
A loan with scheduled periodic payments of both principal and ... 
Fully Amortizing Payment
A periodic loan payment, part of which is principal and part ... 
Unscheduled Recast
The unscheduled recalculation of the remaining amortization schedule ... 
NonAmortizing Loan
A type of loan in which payments on the principal are not made, ...

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