In QM, what is fully amortizing and why is it important?

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Fully amortizing means every payment reduces the loan’s outstanding balance so it is completely paid off by the end of the term. Each payment covers both interest and a portion of the principal, with no remaining balance or large final balloon payment. In QM this structure matters because it supports the borrower's ability to repay and enhances safety: payments stay predictable, the loan doesn’t accumulate negative amortization, and there isn’t a big lump-sum payoff at the end. Lenders and borrowers benefit from knowing the loan will be paid off over the term, rather than requiring an interest-only payment, a balloon, or escalating payments that could endanger repayment.