Definition
Loan Amount
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The loan amount refers to the amount of money a party has borrowed from a lender, effectively being obligated to repay it in full by law.
This is the amount that has been borrowed and should not be confused with the amount financed or loan balance.
When initially applying for a home loan, a fully amortized payment schedule would be presented to the borrower to show how monthly payments contribute towards the full repayment of the loan.
These tables are generated using the original loan amount.
It must be noted that when referring to the amount of loan outstanding at any point in time in the future, the proper term to use is the loan balance. Not the loan amount.
This original loan amount depends on factors like:
Property value
- Loan to value
- Personal income
- Personal debt commitments
- TDSR
- etc
For most lenders, the minimum loan amount for a housing loan would be $100,000. This means that they would not lend for any loan amount that is less that $100,000.
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