Amortization Calculator

What is amortization?

Amortization means paying off a loan with equal payments over time. Each payment covers that month’s interest first, and the rest reduces the balance. Early payments are mostly interest; later payments are mostly principal.

Payment = P × r ÷ (1 − (1 + r)^−n) Interest this month = balance × r Principal this month = payment − interest

Worked example

A $200,000 loan at 6% for 30 years has a payment of $1,199.10. In month one, interest is 200,000 × 0.005 = $1,000, so only $199.10 goes to principal. Over the full term you pay $231,676 in interest.

How to use the schedule

• Switch to the monthly view to see every payment.
• Find the balance at any point, for example before selling or refinancing.
• Compare terms: a 15-year loan has a higher payment but far less interest.

Frequently asked questions

Why is so much of my payment interest at first?

Interest is charged on the outstanding balance, which is highest at the start of the loan.

Does an amortization schedule include taxes and insurance?

No. It covers principal and interest only. Escrowed taxes and insurance are added separately.

What happens if I pay extra?

Extra payments go to principal, which cuts future interest and shortens the loan. The early payoff calculator shows how much.

Can I use this for car or personal loans?

Yes. It works for any fixed-rate loan with equal monthly payments.