Definitions for "Compounded Interest"
Interest that is periodically added to a principal sum, resulting in a new principal balance which then triggers a new interest assessment.
Unpaid interest added to the principal of a loan, increasing both the loan principal and monthly payments.
The frequency with which interest and fees are computed and added to the principal balance. If the promissory note indicates that interest will be compounded, the lender will, at stated intervals, capitalize the accrued interest.