repayments

Repayments refer to the act of paying back money that has been borrowed or is otherwise due. In finance, repayments reduce the outstanding balance and may include both principal and interest components. The structure of repayments is determined by the loan or obligation and is described in the repayment schedule.

Loans and mortgages typically use amortizing repayments, where each payment is partly interest and partly principal, and the balance declines until it is paid off at the end of the term. Some loans are interest-only for a period, with principal due in a final balloon payment. Some loans require regular fixed installments, while others use variable rates, causing payments to vary with interest rate changes. Mortgages commonly have 15- or 30-year amortization schedules.

Credit arrangements like credit cards and lines of credit often involve revolving balances and minimum monthly payments, which may be a small percentage of the outstanding balance and may not fully repay the debt each month; interest accrues on the remaining balance.

Bonds and similar securities pay periodic coupon repayments and repay the face value at maturity.

In student loans there are standard or income-driven repayment plans and possible grace periods after graduation.

Early repayment, prepayment, or refinancing can reduce total interest but may carry penalties depending on terms.

Missing payments can incur fees, harm credit scores, and lead to default; lenders may offer forbearance, deferment, or repayment plans.

Regulation varies by jurisdiction but many systems require disclosure of repayment terms and protect consumers against illegal practices.