The amount you borrowed and still owe, excluding interest.
Every loan payment splits between interest (the cost of borrowing) and principal (actually reducing the debt). Only principal payments build equity.
Example: On a $2,124 mortgage payment, $304 may go to principal in month one.
FAQ
What is Principal in simple terms?
Every loan payment splits between interest (the cost of borrowing) and principal (actually reducing the debt). Only principal payments build equity.