Loans & Debt · Glossary
Principal
The amount you borrowed, or the part of it you still owe. Interest is charged on the principal, and each payment's principal portion reduces it.
On a mortgage, the starting principal is the home price minus your down payment (plus any financed fees). Over time each payment's principal portion pays it down, following the loan's amortization schedule.
In investing, principal means the money you put in, as opposed to the growth it earned.
Calculators that use this
Loan CalculatorMonthly payment and total cost for any fixed-rate loan.Mortgage CalculatorMonthly payment, PITI, and full amortization schedule.Amortization CalculatorSee how any loan's balance and interest change payment by payment.Mortgage Payoff CalculatorHow extra, lump-sum, or biweekly payments pay your mortgage off early.
Related terms
Disclaimer: Definitions are general education, not financial, tax, or legal advice. Figures are for the 2026 tax year unless noted.