It could be an interest only loan, or an amortized loan.

There are a few crucial points worth noting when mortgaging a home with an amortized loan.

It receives individuals' savings and uses these funds to make long-term amortized loans to home purchasers.

Fully amortized loans.

The recast principal balance cap (also known as the "neg am limit") is usually up to a 25% increase of the amortized loan balance over the original loan amount.

The sale price is typically paid in periodic installments, often with a balloon payment at the end to make the timelength of payments shorter than a corresponding fully amortized loan without a final balloon payment.

It established the Federal Home Loan Bank and associated Federal Home Loan Bank Board to assist other banks in providing funding to offer long term, amortized loans for home purchases.