What term describes a loan where total payments pay off the complete principal and interest at term end?

The term that describes a loan where total payments completely pay off both the principal and interest by the end of the loan term is known as "fully amortized." In a fully amortized loan, the borrower makes regular payments that include both interest and a portion of the principal over the life of the loan. By the time the final payment is made, the loan is entirely paid off, meaning there is no remaining balance.

This type of loan structure is commonly used in mortgages, where the payments are scheduled monthly, allowing borrowers to systematically reduce their debt over time. At the start of the loan term, a larger portion of each payment may go towards interest, but as the principal is paid down, the interest portion decreases, and more of the payment is applied to the principal.

The other terms don't describe this particular loan structure. "Annualized" typically refers to converting a rate or a return to an annual basis, while "compounding" relates to the process of earning interest on interest, not directly applicable to the complete repayment of a loan. "Diminishing" generally refers to something that decreases over time and is not specifically tied to the concept of loan repayment in this context.