Amortization Calculator
The Amortization Calculator generates a complete payment schedule for any loan, showing exactly how much of each monthly payment goes to principal and how much goes to interest. Understanding your amortization schedule helps you see how extra payments reduce total interest and shorten your loan term.
Educational estimate. Calculator results are for planning and information only, not financial, tax, medical, legal, or engineering advice. Verify important decisions with official sources or a qualified professional.
Amortization Calculator
Full Loan Schedule with Payment Breakdown
📐 Formula & Method
Monthly Payment
P = loan principal, r = monthly rate (annual rate ÷ 12 ÷ 100), n = total payments (years × 12).
Interest Portion Each Month
Each month, the interest charged is the current outstanding balance multiplied by the monthly interest rate. The remainder of the payment reduces the principal.
Principal Portion Each Month
As the balance decreases over time, less interest is charged each month, so more of each payment goes toward principal — the key feature of amortization.
📋 How to Use
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1
Enter your loan amount (principal).
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2
Enter the annual interest rate.
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3
Enter the loan term in years.
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4
Optionally, enter an extra monthly payment to see the impact on total interest and payoff date.
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5
Click Calculate to see your monthly payment, total interest, and full amortization breakdown.
How Loan Amortization Works
Amortization is the process of paying off a loan through regular payments over time. Each payment is split between two components: interest (the cost of borrowing) and principal (repayment of the original loan amount). In the early years of a mortgage, most of your payment goes to interest. Over time, the balance shifts so more goes to principal.
On a $320,000 30-year mortgage at 7%, your monthly payment is $2,129. In month 1, $1,867 (88%) goes to interest and only $262 (12%) reduces your balance. By month 180 (year 15), the split is roughly 50/50. By the final payment, nearly all of it is principal.
Making extra payments directly toward the principal can dramatically reduce the total interest you pay and shorten your loan. Adding $200/month extra on a $320,000 30-year loan at 7% saves approximately $72,000 in interest and pays off the loan 5 years early. Even a one-time annual extra payment has a significant compounding effect.
In the UK, most mortgages follow the same amortization structure — called a repayment mortgage. Interest-only mortgages (where you only pay interest and repay the full principal at the end) are far less common since stricter affordability rules were introduced after 2014.
🔬 Methodology & Accuracy
Formula: Uses the standard mathematical formula shown in the Formula & Method section above. All computations run client-side in your browser — no data is sent to our servers.
Data sources: Tax bands, contribution limits and regulatory rates are taken from official US (IRS, SSA) and UK (HMRC, gov.uk) publications for the current tax year, and updated when bands change.
Last reviewed: June 2026 · Accuracy: Results are precise to two decimal places using IEEE-754 double-precision arithmetic. Intended for educational and planning use only.
For informational purposes only. Results are estimates based on the inputs and formulas provided. For financial, tax, medical, or legal decisions, consult a qualified professional. Rates and regulations change — always verify current figures with official sources.