Amortization Schedule Calculator
An Amortization Schedule Calculator shows the complete breakdown of each payment over the life of a loan. For each payment period, it displays how much goes toward principal, how much goes toward interest, and the remaining loan balance. Amortization schedules are commonly used for mortgages, auto loans, and personal loans to understand the true cost of borrowing. In the early years of a loan, most of your payment goes toward interest. As the principal decreases, more of each payment goes toward paying down the loan. This calculator helps you see exactly when you will pay off your loan and how much total interest you will pay.
Formula
Monthly Payment = P × [r(1 + r)^n] ÷ [(1 + r)^n − 1] P = loan principal r = monthly interest rate (annual rate ÷ 12) n = total number of payments Interest Portion = Remaining Balance × r Principal Portion = Monthly Payment − Interest Portion
Example
For a $200,000 loan at 6% annual interest for 30 years (360 payments): Monthly Payment = $200,000 × [0.005(1.005)^360] ÷ [(1.005)^360 − 1] Monthly Payment = $1,199.10 First payment: $1,000.00 interest, $199.10 principal Remaining balance after first payment: $199,800.90
How to Use
- Enter your total loan amount (principal)
- Input the annual interest rate
- Enter the loan term in years
- Click calculate to see the full amortization schedule
- Review the breakdown of principal vs. interest for each payment
Frequently Asked Questions
What is an amortization schedule?
An amortization schedule is a table showing each loan payment broken down into principal and interest components, along with the remaining balance after each payment. It shows how the loan is gradually paid off over time.
Why does interest decrease over time in an amortization schedule?
Interest is calculated on the remaining balance. As you pay down the principal, the remaining balance decreases, so the interest portion of each payment also decreases, and more of your payment goes toward principal.
Can I pay off my loan early using the amortization schedule?
Yes. Any extra payments above the scheduled amount go directly toward reducing the principal. This reduces the remaining balance faster, which means less total interest paid and an earlier payoff date.
How is the monthly payment calculated?
The monthly payment is calculated using the loan amount, interest rate, and loan term. The formula ensures the loan is fully paid off (balance reaches zero) by the end of the term.
Does the amortization schedule change if interest rates change?
For fixed-rate loans, the schedule stays the same. For adjustable-rate loans (ARMs), the schedule changes whenever the interest rate adjusts, which can change your monthly payment.