Amortization Calculator

What an amortization schedule actually shows

An amortization schedule breaks a loan into its individual payments and shows, for each one, how much goes to interest, how much goes to principal, and what balance remains afterward. This tool calculates that month by month internally, then groups the results into yearly rows so you can see the pattern without scrolling through 360 individual months on a 30-year loan. The "Remaining Balance" column is the number that matters most if you're deciding whether refinancing or paying the loan off early makes sense at a given point.

The formula behind the fixed payment

This tool uses the standard amortization 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 total number of monthly payments. That single formula determines a fixed payment amount; the schedule below it shows how that fixed payment's principal/interest split shifts every single month even though the payment itself never changes.

Why the split shifts from interest-heavy to principal-heavy

Each month's interest charge is the current balance multiplied by the monthly rate, so it's largest when the balance is largest at the very start of the loan. As payments chip away at the balance, the interest charge shrinks and the remainder of the fixed payment (which stays constant) increasingly goes to principal. On a $300,000, 30-year loan at 6.5%, for example, the first year's payments are roughly two-thirds interest, while the final year is almost entirely principal. This is also why paying off a loan even a few years early saves disproportionately more interest than the same extra payment made near the end of the term.

Reading the yearly schedule

Each row shows the total principal and interest paid across that year's 12 payments, plus the balance remaining at year's end. Watching the "Principal Paid" column grow and the "Interest Paid" column shrink year over year is a concrete way to see equity build useful for deciding when refinancing, selling, or making a lump-sum payment would have the most impact.

FAQ

Why is so much of my early payment interest?
Interest is calculated on the remaining balance each month, which is highest at the start of the loan so more of each payment goes toward interest early on, shifting toward principal over time as the balance shrinks.

Does this include property tax or insurance?
No this shows principal and interest only. Add your own estimates for taxes, insurance, or PMI separately, or use the Mortgage Calculator, which includes those in the monthly total.

Why does the schedule show yearly totals instead of every single month?
A 30-year loan has 360 monthly rows, which is too many to scan usefully. Grouping principal and interest into yearly totals makes it much easier to see the overall shift from interest-heavy to principal-heavy payments across the loan's life.

What's the difference between this and the Loan Calculator?
The Loan Calculator shows the monthly payment and loan totals. This tool runs the same formula but also generates the full year-by-year amortization schedule, showing exactly how much principal and interest you'll pay and what balance remains after each year. For car loans specifically, our free car payment calculator includes sales tax in the calculation.

Can I use this to see how extra payments would shorten my loan?
Not directly this tool calculates the standard schedule for the term and rate you enter, without an extra-payment input. To estimate the effect of paying more, try re-running the calculation with a shorter loan term and compare the resulting schedule and total interest.

Why does my remaining balance never quite hit exactly zero until the last row?
Rounding the fixed monthly payment to the cent means the very last payment is adjusted slightly to clear whatever balance remains, so the schedule zeroes out exactly at the final payment rather than drifting negative or leaving a few cents outstanding.