"Mortgage amortization" is a complex-sounding phrase that describes a simple process: paying off your home with a fixed monthly payment over time. You can make better financial decisions by understanding how amortization and your mortgage work together. What is mortgage amortization? Mortgage amortization refers to paying a mortgage in regular, fixed installments over time. Your lender splits your payment into two parts: one that reduces the mortgage principal — the amount you borrowed — and the other ...