Skip to content
Finance Calc Kit
Loans

Amortization Calculator

Generate a detailed annual and monthly amortization schedule for your mortgage or loan with interactive payment summaries.

Loan details

$
%
$

Monthly payment

$536.82

360 months at 5.0%

Total interest

$93,255.78

Interest over loan life

Total cost

$193,255.78

Principal + interest

Payoff date

July 2056

360 total payments

Payment breakdown

  • Principal$100,000.0051.7%
  • Interest$93,255.7848.3%

How loan amortization works

Fixed-rate amortization computes a constant monthly payment, splitting each payment between interest on the remaining balance and principal reduction.

  1. Find the periodic monthly interest rate

    i=r12i = \frac{r}{12}

    Divide the nominal annual rate of 5.0% by 12 months (0.4167% per month).

  2. Calculate the fixed monthly payment (PMT)

    PMT=P×i(1+i)n(1+i)n−1\mathrm{PMT} = P \times \frac{i(1 + i)^n}{(1 + i)^n - 1}

    Where P is the initial loan principal of $100,000.00 and n is 360 total scheduled months. If interest is 0%, PMT is simply principal divided by n.

  3. Determine the interest portion for period k

    Ik=Bk−1×iI_k = B_{k-1} \times i

    Interest is charged only on the unpaid balance remaining at the start of that month.

  4. Apply the remainder to principal reduction

    Pk=PMT−Ik+Extra,Bk=Bk−1−PkP_k = \mathrm{PMT} - I_k + \text{Extra}, \quad B_k = B_{k-1} - P_k

    Each month, the remaining balance decreases, which causes the interest portion to decline and the principal portion to grow over time.

Amortization schedule

Year-by-year summary. Expand any year to view monthly breakdown.

YearPaymentPrincipalInterestBalance
$2,684.11$605.80$2,078.31$99,394.20
$6,441.86$1,506.36$4,935.50$97,887.84
$6,441.86$1,583.43$4,858.43$96,304.41
$6,441.86$1,664.44$4,777.42$94,639.97
$6,441.86$1,749.59$4,692.26$92,890.38
$6,441.86$1,839.11$4,602.75$91,051.27
$6,441.86$1,933.20$4,508.66$89,118.07
$6,441.86$2,032.11$4,409.75$87,085.97
$6,441.86$2,136.07$4,305.79$84,949.89
$6,441.86$2,245.36$4,196.50$82,704.54
$6,441.86$2,360.23$4,081.63$80,344.30
$6,441.86$2,480.99$3,960.87$77,863.31
$6,441.86$2,607.92$3,833.94$75,255.39
$6,441.86$2,741.35$3,700.51$72,514.05
$6,441.86$2,881.60$3,560.26$69,632.45
$6,441.86$3,029.03$3,412.83$66,603.42
$6,441.86$3,184.00$3,257.86$63,419.42
$6,441.86$3,346.90$3,094.96$60,072.53
$6,441.86$3,518.13$2,923.73$56,554.40
$6,441.86$3,698.12$2,743.73$52,856.27
$6,441.86$3,887.33$2,554.53$48,968.94
$6,441.86$4,086.21$2,355.65$44,882.73
$6,441.86$4,295.27$2,146.59$40,587.46
$6,441.86$4,515.02$1,926.84$36,072.44
$6,441.86$4,746.02$1,695.84$31,326.42
$6,441.86$4,988.84$1,453.02$26,337.58
$6,441.86$5,244.07$1,197.79$21,093.51
$6,441.86$5,512.37$929.49$15,581.14
$6,441.86$5,794.39$647.46$9,786.74
$6,441.86$6,090.85$351.01$3,695.90
$3,757.75$3,695.90$61.85$0.00
Report tool

How loan amortization works

Amortization is the process of spreading out a loan into a series of equal, periodic payments over time. Each payment covers both interest and principal, structured so that the final installment brings the remaining balance to exactly zero. Because interest is charged on the outstanding balance, the composition of each payment changes across the life of the loan: early payments consist mostly of interest, while later payments consist mostly of principal.

If you are calculating a straightforward monthly payment without viewing full annual schedules, the EMI calculator provides a rapid monthly view. If your loan requires fixed principal repayments with decreasing monthly payments, use the equal principal amortization calculator. To generate a customizable matrix of capital recovery and payment factors across various interest rates and durations, consult the annuity payment table. For non-monthly compounding frequencies or to solve for the loan amount or interest rate, explore the advanced loan calculator. If your financing involves lower periodic installments with a lump sum due at maturity, calculate your payoff obligations with our balloon payment calculator. If you are evaluating home affordability versus renting, check the 3x rent calculator or examine adjustable rate structures with the 10/1 ARM mortgage calculator. If you want to compare standard 12-month payments against an accelerated 26-payment schedule, use our biweekly mortgage calculator.

The standard amortization formula

The fixed monthly payment PMT is derived from the present value of an ordinary annuity. For a loan principal P, nominal annual interest rate r, periodic monthly rate i = r / 12, and total number of payment periods n (tenure in years multiplied by 12), the formula is:

PMT=P×i(1+i)n(1+i)n−1\mathrm{PMT} = P \times \frac{i(1 + i)^n}{(1 + i)^n - 1}

When the interest rate is 0%, the formula simplifies to PMT = P / n. For example, a $100,000 loan at 5.00% annual interest over 30 years (360 months) has a monthly interest rate of i = 0.05 / 12 = 0.004167. Applying the annuity formula yields a monthly payment of $536.82, generating $93,255.78 in total interest over 360 months.

Periodic interest and principal allocation

In every period k, the interest charge is calculated strictly on the opening balance from the preceding period:

Ik=Bk−1×iI_k = B_{k-1} \times i

The remaining portion of the fixed payment is applied directly toward reducing the loan balance:

Pk=PMT−Ik,Bk=Bk−1−PkP_k = \mathrm{PMT} - I_k, \quad B_k = B_{k-1} - P_k

In month 1 of a 30-year $100,000 loan at 5%, interest is $100,000 x (0.05 / 12) = $416.67, leaving only $120.15 for principal reduction. By month 180 (year 15), the principal balance has declined to $68,708.87, reducing monthly interest to $286.29 and increasing principal reduction to $250.53. In the final month, interest is merely $2.23 and principal payment is $534.59.

Impact of extra principal payments

Because interest is calculated on the remaining balance, every extra dollar paid toward principal permanently reduces the base on which all future interest is calculated. This creates a compounding reduction in total interest and shortens the loan term without altering the scheduled contract rate.

For instance, adding an extra $100 per month to a $100,000, 30-year 5% mortgage reduces total interest from $93,255.78 to $62,483.47 (saving $30,772.31) and pays off the loan 104 months (8.67 years) early.

Frequently asked questions

What is an amortization schedule?
An amortization schedule is a complete table of periodic loan payments detailing the specific dollar amount of principal and interest in each payment, along with the remaining loan balance after each installment.
Why is interest higher at the beginning of the loan?
Interest is calculated as a percentage of the remaining unpaid principal. At the start of the loan, the balance is at its highest, so the interest charges represent the largest share of the monthly payment.
How do extra payments affect my amortization schedule?
Extra payments reduce the unpaid principal directly. This lowers the interest charged in all subsequent months, shortening the overall loan duration and reducing the total interest paid.
What is the difference between amortization and simple interest?
Simple interest loans calculate interest only on the original principal without an evolving amortizing schedule, whereas amortizing loans recompute interest periodically on the declining outstanding balance as payments are made.
Can I export or download the amortization schedule?
Yes. You can switch between annual summaries and monthly schedules, and click Export CSV to download the complete payment timeline for spreadsheet analysis.
What happens if the interest rate is 0%?
At a 0% interest rate, no interest is accrued. The monthly payment is simply the principal divided by the total number of months, and total cost equals the principal.
Does this calculator support mortgages and auto loans?
Yes. Any fixed-rate installment loan, including residential mortgages, auto loans, personal loans, and student loans, follows this standard amortization schedule.

Resources and references

The formulas and methods in this calculator were checked against these independent sources.