📑 Amortization Calculator
Generate full loan amortization schedule
How Amortization Calculation Works
Formula
Monthly Payment = P × [r(1+r)^n] / [(1+r)^n − 1]
- 1Enter the loan amount, interest rate, and loan term.
- 2The calculator computes the fixed monthly payment.
- 3For each month: interest = remaining balance × monthly rate.
- 4Principal payment = total payment − interest portion.
- 5The schedule shows how the split shifts from mostly interest to mostly principal over time.
About Amortization Calculator
Generate a complete loan amortization schedule. See monthly payment breakdown between principal and interest over the life of any loan. Supports extra payments and prepayment analysis.
Frequently Asked Questions
Why do I pay mostly interest at the start?
Interest is calculated on the remaining balance. Early on, the balance is high, so most of your payment covers interest. As the balance decreases, more goes to principal. This is how standard amortization works.
How do extra payments help?
Extra payments go directly to principal, reducing the balance faster. This saves interest and shortens the loan. Even $100/month extra on a $300,000 mortgage at 6% saves over $50,000 in interest and cuts years off the loan.
What is negative amortization?
Negative amortization occurs when payments don't cover the interest, causing the balance to grow instead of shrink. This can happen with minimum payment options or adjustable-rate loans. It's generally something to avoid.