Amortization Calculator
Enter a loan amount, rate and term to get the monthly payment and a complete year-by-year schedule — how much of each year is principal, how much is interest, and the balance left at the end.
Why early payments are mostly interest
Each payment first covers the interest accrued that month on the outstanding balance; only the remainder reduces the principal. In month one of a 240,000 loan at 6%, interest is 1,200 of the payment — and the principal slice is what is left. As the balance falls, the interest charge falls with it, so the principal slice grows month after month without the payment changing.
The schedule makes the crossover visible: roughly the first third of a 20-year loan is mostly interest, the last third is mostly principal. This is also why extra payments made early save so much interest — they remove balance that would otherwise accrue interest for decades.
Reading the schedule
Each row aggregates twelve monthly payments: the principal you retire that year, the interest you pay that year, and the balance at its end. The principal column grows every year while the interest column shrinks — the two together always equal 12 × the monthly payment.
The balance column is what refinancing or selling conversations are about: it is the number you would need to pay off the loan at the end of that year.
Frequently asked questions
Why is the first payment's interest so high?
Interest is charged on the full balance at the start — 6% a year is 0.5% a month, so month one carries the largest interest charge of the whole loan. It falls every month as the balance is paid down.
How is the yearly table computed?
The calculator runs the standard monthly reducing-balance schedule and aggregates each twelve months into one row: principal retired, interest paid, and the balance at year end.
What happens if I pay extra one month?
The extra goes straight to principal if your contract allows it, which shrinks every future interest charge. This table shows the baseline schedule — recalculate with a shorter term to approximate the effect of a lump-sum prepayment.
Why do principal and interest add up to exactly 12 payments?
Because each monthly payment is split into exactly those two parts — there is nothing else in a principal-and-interest loan.
Does the schedule include taxes or insurance?
No, by design. Escrow items vary by country and property; this table tracks the loan itself.
Can I share a specific schedule?
Yes — loan amount, rate and term travel in the URL, so a shared link reopens the exact table.