What is a negative amortization loan?
In finance, negative amortization, also known as NegAmMort, is
an amortization method in which the borrower pays back less than
the full amount of interest owed to the lender each month. The
shorted amount is then added to the total amount owed to the
lender. Such a practice would have to be agreed upon before
shorting the payment so as to avoid default on payment. Also known
as deferred interest or Graduated Payment Mortgage (GPM).