Amortization Calculator
Use our free Amortization Calculator to generate a detailed payment schedule for mortgages, loans, and debts. See how much interest you’ll pay, track principal reduction, and explore extra payment savings. Perfect for home buyers, car loans, and personal finance planning!
Loan Details
Monthly Payment
Total Interest
Total Cost
Payoff Date
Amortization Schedule
| Payment # | Date | Payment | Principal | Interest | Extra Payment | Remaining Balance |
|---|
Accurate Payment
See exactly how each payment splits between principal and interest over the loan term, with precision down to the cent.
Extra Payment Simulator
How additional payments can shorten your loan term & save thousands in interest with dynamic calculations.
Amortization Schedule
Get a year-by-year or month-by-month table showing your remaining balance and interest paid at any point.
FAQ: Frequently Asked Questions
What is an amortization calculator?
An amortization calculator is a financial tool that shows how loan payments are divided between principal and interest over time. It calculates your periodic payments based on the loan amount, interest rate, and term. Each payment has two parts: interest (calculated on the remaining balance) and principal (which reduces your loan balance). As you progress through the loan, the interest portion decreases while the principal portion increases, though your total payment stays the same.
Why is my first mortgage payment mostly interest?
In the early stages of a loan, your outstanding balance is at its highest, so the interest calculation (which is based on current balance) is largest. For example, on a 250,000 loan at 5.5250,000loanat5.51,145, leaving only a small portion of your payment to reduce principal. This allocation shifts gradually over time as your principal balance decreases with each payment. With our Amortization Calculator you can calculate accurately your mortgage payment.
How does making extra payments affect my amortization schedule?
Extra payments directly reduce your principal balance, which then reduces the interest calculated on future payments. This creates a compounding effect – each extra payment means more of your regular payments go toward principal. Even small additional amounts can significantly shorten your loan term and reduce total interest. For instance, adding 100/monthtoa100/monthtoa250,000 mortgage could save over $40,000 in interest and pay off the loan 4 years early.
What's the difference between a 15-year and 30-year mortgage amortization?
A 15-year mortgage has higher monthly payments but much less total interest because you’re paying principal faster. For a 250,000loanat5.5511,009 total (261,009interest),whilethe15−yearcosts392,052 ($142,052 interest). The shorter term builds equity faster and typically has a lower interest rate, but requires higher monthly payments that may not fit all budgets.
How do interest rates affect my amortization schedule?
Higher interest rates increase both your monthly payment and total interest paid. For example, a 250,00030−yearloanat3.5154,196 in interest versus $261,009 at 5.5%. The rate also affects how quickly you build equity – at higher rates, more of each payment goes toward interest in the early years, slowing principal reduction. Even a 0.5% rate difference can significantly impact long-term costs.
What's the difference between amortization and simple interest loans?
Amortized loans (like mortgages) have payments that cover both principal and interest, with the allocation changing over time. Simple interest loans (like some personal loans) calculate interest daily based on the current balance, so payments may vary. Amortized loans provide predictable payments, while simple interest loans can save money if you pay early but may cost more if you pay slowly.
Can I change my amortization schedule after getting a loan?
Yes, through refinancing or recasting. Refinancing replaces your loan with a new one (new rate/term), completely resetting the amortization. Recasting keeps your existing loan but recalculates payments based on a lump sum principal reduction, lowering payments while keeping the original term. Some lenders also offer term modifications that adjust your amortization without full refinancing.
Why does my amortization schedule show negative?
How accurate are online amortization calculator?
Quality Amortization Calculator are mathematically precise for fixed-rate loans, using standard amortization formulas. However, they may not account for all loan features (like rate adjustments, fees, or payment caps on ARMs). For variable-rate loans, they typically show projections based on current rates. Always verify with your lender, as actual loan terms may include additional factors not reflected in generic calculators.
