Amortization Schedule Calculator
Calculate your monthly mortgage or loan payment and see a year-by-year breakdown of principal vs. interest over the life of your loan.
Loan amortization is the process of paying down a loan through fixed periodic payments, where each payment covers both interest and principal. Early payments are mostly interest; later payments are mostly principal. Understanding amortization helps you see exactly how much a loan really costs.
Monthly payment 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
- n = total number of payments = Years × 12
Interest portion of any payment: Interest = Remaining Balance × Monthly Rate
Principal portion: Principal Paid = M − Interest
Worked example: $250,000 mortgage, 6.5% annual rate, 30-year term.
r = 6.5% ÷ 12 = 0.5417% = 0.005417 n = 30 × 12 = 360 payments
M = 250,000 × [0.005417 × (1.005417)³⁶⁰] ÷ [(1.005417)³⁶⁰ − 1] M = $1,580.17/month
First payment breakdown: Interest = $250,000 × 0.005417 = $1,354.17 Principal = $1,580.17 − $1,354.17 = $226.00
Total paid over 30 years: $1,580.17 × 360 = $568,861 — meaning $318,861 in interest on a $250,000 loan.
Key insight: extra payments Adding just $200/month to the above mortgage cuts 6+ years off the term and saves over $60,000 in interest.
Typical loan terms:
- Mortgage: 15 or 30 years
- Auto loan: 3–7 years
- Personal loan: 1–5 years
- Student loan: 10–25 years
Refinance break-even rule
Refinancing makes sense when (monthly savings × months you’ll actually keep the loan) exceeds the closing costs. With typical closing costs of $3,000 to $6,000 on a mortgage, the break-even point usually lands 18 to 36 months out. If you plan to sell or move before then, refinancing doesn’t pay off no matter how attractive the new rate looks. Run the math both ways: the savings on the new rate AND the realistic months you’ll hold the loan.
Rate must match payment frequency
The formula’s “r” is the rate per payment period, not the annual rate. For a monthly-payment loan use r = annual ÷ 12; for a weekly-payment loan use r = annual ÷ 52. Plugging the annual rate directly produces a wildly wrong payment, overstated by orders of magnitude in some cases.
How we build and check this calculator
This calculator runs entirely in your browser, so the numbers you enter stay on your device. The math behind it is written by hand and tested against worked examples and standard references before the page goes live.
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