Amortization Calculator
Enter your loan details to see the monthly payment, total interest, and a full amortization schedule. Add an optional extra payment to see how much faster you could be debt-free.
| Year | Principal | Interest | Paid | Balance |
|---|---|---|---|---|
| 1 | $2,794 | $16,168 | $18,962 | $247,206 |
| 2 | $2,981 | $15,981 | $18,962 | $244,224 |
| 3 | $3,181 | $15,781 | $18,962 | $241,043 |
| 4 | $3,394 | $15,568 | $18,962 | $237,649 |
| 5 | $3,621 | $15,341 | $18,962 | $234,027 |
| 6 | $3,864 | $15,098 | $18,962 | $230,163 |
| 7 | $4,123 | $14,839 | $18,962 | $226,041 |
| 8 | $4,399 | $14,563 | $18,962 | $221,642 |
| 9 | $4,694 | $14,269 | $18,962 | $216,948 |
| 10 | $5,008 | $13,954 | $18,962 | $211,940 |
| 11 | $5,343 | $13,619 | $18,962 | $206,597 |
| 12 | $5,701 | $13,261 | $18,962 | $200,896 |
| 13 | $6,083 | $12,879 | $18,962 | $194,813 |
| 14 | $6,490 | $12,472 | $18,962 | $188,323 |
| 15 | $6,925 | $12,037 | $18,962 | $181,398 |
| 16 | $7,389 | $11,573 | $18,962 | $174,009 |
| 17 | $7,884 | $11,078 | $18,962 | $166,126 |
| 18 | $8,412 | $10,551 | $18,962 | $157,714 |
| 19 | $8,975 | $9,987 | $18,962 | $148,739 |
| 20 | $9,576 | $9,386 | $18,962 | $139,163 |
| 21 | $10,217 | $8,745 | $18,962 | $128,946 |
| 22 | $10,902 | $8,061 | $18,962 | $118,045 |
| 23 | $11,632 | $7,330 | $18,962 | $106,413 |
| 24 | $12,411 | $6,551 | $18,962 | $94,002 |
| 25 | $13,242 | $5,720 | $18,962 | $80,761 |
| 26 | $14,129 | $4,833 | $18,962 | $66,632 |
| 27 | $15,075 | $3,887 | $18,962 | $51,557 |
| 28 | $16,084 | $2,878 | $18,962 | $35,473 |
| 29 | $17,162 | $1,800 | $18,962 | $18,311 |
| 30 | $18,311 | $651 | $18,962 | $0 |
Showing 30 years. Figures are estimates and assume a fixed rate.
How to use this calculator
Enter your loan amount, annual interest rate, and term in years. The calculator instantly shows your fixed monthly payment, the total interest you'll pay over the life of the loan, and the total amount repaid. Use the optional extra monthly payment field to model paying a little more each month — the full amortization schedule and all totals update automatically so you can see exactly how much time and money you save.
To compare scenarios, change one variable at a time. Lowering the interest rate, shortening the term, or adding even a small extra payment can produce dramatically different outcomes.
How amortization works
On a fully amortizing fixed-rate loan, your payment stays the same every month, but the makeup of that payment changes over time. In the early years, most of each payment covers interest because the outstanding balance is high. As the balance falls, the monthly interest charge shrinks, and a larger share of each payment reduces the principal. By the final payment, almost the entire amount retires principal and the balance reaches exactly zero.
This gradual shift is visible in the amortization schedule — the table of every payment — where you can watch the interest column shrink and the principal column grow month by month over the loan's life.
Making extra principal payments early accelerates this process. Each extra dollar reduces the balance immediately, which means less interest accrues in every subsequent month. The savings compound quietly in the background for the remainder of the loan, which is why even small extra amounts can shave years off a 30-year mortgage.
The amortization formula
M = P · [ r(1 + r)n ] / [ (1 + r)n − 1 ]
Where M = monthly payment, P = principal (loan amount), r = monthly interest rate (annual rate ÷ 12), and n = total number of payments (years × 12). When the interest rate is 0%, the payment is simply the principal divided by the number of months.
Each month's interest charge is calculated as balance × monthly rate. The principal reduction for that month is payment − interest. Any extra payment is then subtracted from the balance as additional principal. The new balance becomes the starting point for the next month's interest calculation, and the cycle repeats until the balance reaches zero.
Worked example — step by step
Suppose you borrow $250,000 at 6.5% annual interest for 30 years.
- Monthly rate: 6.5% ÷ 12 = 0.5417%
- Number of payments: 30 × 12 = 360
- Monthly payment: approximately $1,580
On Payment 1: interest = $250,000 × 0.5417% = $1,354. Principal reduction = $1,580 − $1,354 = $226. Remaining balance = $249,774.
By Payment 180 (year 15), the balance is around $193,000, so the interest portion has fallen and the principal share has grown — yet the payment is still $1,580.
Over all 360 payments with no extra amounts, you repay roughly $319,000 in interest — more than the original loan. Now add $200/month in extra principal: the loan pays off roughly 5 years early and saves over $50,000 in interest. Enter these numbers above to verify the exact figures.
How to interpret your results
The monthly payment is what you owe each month on principal and interest alone. Your actual mortgage payment will also include escrow for property taxes and homeowners insurance, and possibly private mortgage insurance (PMI) — none of which are part of this calculation.
The total interest figure is often surprising. On long-term loans at moderate rates, you may pay more in interest than you borrowed. This illustrates why interest rate and term are both critical — a 15-year loan at the same rate as a 30-year loan will cost far less in total, even though the monthly payment is higher.
The amortization schedule is useful for understanding your equity position: the difference between the home's value and the remaining balance. Early on, equity builds slowly because most payments go to interest. Equity accelerates in the second half of the loan.
Common mistakes to avoid
- Comparing loans only by monthly payment. A longer term lowers the payment but dramatically increases total interest. Always compare total cost alongside the monthly figure.
- Forgetting taxes, insurance, and PMI. Your real monthly housing cost includes these items. Lenders often require them to be escrowed, so the actual payment you write each month is higher than the P&I shown here.
- Assuming extra payments are automatically applied to principal. Contact your lender to confirm that extra amounts reduce your balance directly rather than being held as a credit toward future payments or applied to interest first.
- Not checking for prepayment penalties. While uncommon on modern mortgages, some loans — especially older ones — charge a fee for paying off early. Confirm before making large extra payments.
- Ignoring the opportunity cost. Extra mortgage payments are not always the highest-return move. If you carry high-interest debt or haven't funded your emergency savings, those may be higher priorities. This calculator shows the interest saved; weigh that against other uses of the same money.
This tool provides estimates for general information only and is not financial advice. Your actual payment may include taxes, insurance, PMI, or fees not shown here.
How we calculate this
We use the standard fixed-rate amortization formula to find the level monthly payment, then build the schedule one payment at a time — splitting each into interest (rate × balance) and principal, with any extra payment applied to principal.
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Frequently asked questions
What is an amortization schedule?
An amortization schedule is a table that shows every payment on a loan, split into how much goes to interest and how much goes to the principal balance. Early payments are mostly interest; later payments are mostly principal. The schedule also shows the remaining balance after each payment, so you can see exactly where you stand at any point in the loan.
How is my monthly payment calculated?
A fixed-rate loan uses the formula M = P · r · (1 + r)^n / ((1 + r)^n − 1), where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the number of payments (years × 12). The payment stays the same every month, but the allocation between principal and interest shifts over time — interest shrinks as the balance falls.
How do extra payments reduce my loan faster?
Any extra amount goes straight to your principal balance, not toward future scheduled payments. Because interest is calculated on the remaining balance each month, a smaller balance means less interest accrues — and that saving compounds every month afterward. Even a modest extra payment can shave years off the term.
Does this calculator work for mortgages, auto loans, and personal loans?
Yes. The amortization formula is the same for any fully amortizing, fixed-rate loan. Enter the amount, rate, and term to match your specific loan. Note that mortgages may also carry taxes, insurance, and PMI that are not included here.
What does 'fully amortizing' mean?
A fully amortizing loan is structured so the regular payment exactly pays off the balance to zero by the final payment. Each payment covers the interest due plus some principal. Contrast this with interest-only loans, where no principal is repaid until the end, or balloon loans, where a large lump sum is due at maturity.
Why is my early payment mostly interest?
Interest is always charged on the outstanding balance. At the start of a long loan, the balance is at its highest, so the interest portion of each payment is also at its highest. As you pay down the principal over time, the balance — and thus the monthly interest — gradually falls, and more of each payment shifts to principal.
How do I use this to compare a 15-year vs. a 30-year mortgage?
Run the same loan amount and rate at 15 years, note the payment and total interest, then switch the term to 30 years and compare. The 30-year will have a lower payment but far more total interest paid. The difference in total interest is often eye-opening and helps you decide whether the payment savings are worth the extra cost.
Is my information saved?
No. All calculations happen in your browser. Nothing you enter is sent to a server or stored.