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Amortization refers to the distribution of payments over a period of time as determined by an amortization schedule. The amortization payments, associated with a loan, would typically consist of installments of both principal and interest divided into equal amounts for the duration of the loan. In most loans, a greater portion of the payment is applied towards the interest at the beginning of the amortization period, with a greater amount of the payment applied to the principal at the end of the amortization period.

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