Amortization Calculator
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Results
Monthly payment of $1,264.14; paid off in 30 years with $255,089 of interest
- Principal
- $200,000
- Interest
- $255,089
| Payment | Amount | Interest | Principal | Balance |
|---|---|---|---|---|
| 1 | $1,264.14 | $1,083.33 | $180.80 | $199,819.20 |
| 2 | $1,264.14 | $1,082.35 | $181.78 | $199,637.42 |
| 3 | $1,264.14 | $1,081.37 | $182.77 | $199,454.65 |
| 4 | $1,264.14 | $1,080.38 | $183.76 | $199,270.89 |
| 5 | $1,264.14 | $1,079.38 | $184.75 | $199,086.14 |
| 6 | $1,264.14 | $1,078.38 | $185.75 | $198,900.39 |
| 7 | $1,264.14 | $1,077.38 | $186.76 | $198,713.63 |
| 8 | $1,264.14 | $1,076.37 | $187.77 | $198,525.86 |
| 9 | $1,264.14 | $1,075.35 | $188.79 | $198,337.07 |
| 10 | $1,264.14 | $1,074.33 | $189.81 | $198,147.26 |
| 11 | $1,264.14 | $1,073.30 | $190.84 | $197,956.42 |
| 12 | $1,264.14 | $1,072.26 | $191.87 | $197,764.55 |
From payment 233, more of each payment goes to principal than to interest.
How to use the amortization calculator
- Enter the loan amount, the annual interest rate and the term.
- Optionally add extra payments: a fixed amount every month, an amount once a year (for example from a bonus), or a single lump sum. Enter the payment number when the yearly or one-time extra is made.
- Switch the schedule between monthly rows and yearly totals. Download or print it from the toolbar.
Amortization formula
Interest this month = balance × r
Principal this month = payment − interest (+ any extra)
New balance = balance − principal
P is the amount borrowed, r the monthly rate (annual rate ÷ 12) and n the number of monthly payments. The payment is fixed for the whole loan, but the split changes every month. Early on the balance is large, so most of the payment is interest. As the balance falls, the interest shrinks and more of each payment repays principal. Extra payments go straight to principal, which lowers every later interest charge.
Worked example: $200,000 at 6.5% for 30 years
The monthly payment is $1,264.14. In the first month the interest is 200,000 × 0.065 ÷ 12 = $1,083.33, so only $180.80 reduces the balance. Not until payment 233 does the principal part overtake the interest part. Over 30 years you pay $255,089 of interest, more than the amount borrowed.
Adding $100 a month clears the loan in 24 years 5 months instead of 30 years and saves $55,946 of interest.
How the balance falls
| Year | Interest that year | Principal that year | Balance at year end |
|---|---|---|---|
| 1 | $12,934 | $2,235 | $197,765 |
| 5 | $12,272 | $2,897 | $187,222 |
| 10 | $11,163 | $4,006 | $169,552 |
| 15 | $9,630 | $5,540 | $145,118 |
| 20 | $7,509 | $7,661 | $111,331 |
| 25 | $4,576 | $10,593 | $64,608 |
| 30 | $521 | $14,649 | $0.00 |
What an extra monthly payment saves
Same $200,000 loan at 6.5% for 30 years, with a fixed extra amount added to every payment from the first month.
| Extra per month | Paid off in | Total interest | Interest saved |
|---|---|---|---|
| None | 30 years | $255,089 | – |
| $50.00 | 26 years 10 months | $223,130 | $31,959 |
| $100 | 24 years 5 months | $199,143 | $55,946 |
| $250 | 19 years 5 months | $152,310 | $102,779 |
| $500 | 14 years 9 months | $110,941 | $144,148 |
Using the schedule to make decisions
The balance column answers questions that the payment alone cannot. If you might sell or refinance after five years, the year-5 balance in the table above is roughly what you would still owe. A sixth of the term has passed, but you will have repaid far less than a sixth of the loan, because early payments are mostly interest. The yearly view also shows how much interest you pay each calendar year of the loan, which is useful for budgeting or record keeping; your lender's year-end statement is the official figure. And when you are weighing an extra payment against another use for the money, compare the interest saved with what that money could earn elsewhere.
Reading your schedule
- Early extra payments are worth the most. A dollar of principal repaid in year 1 avoids interest for every remaining year; the same dollar in year 25 saves very little.
- Tell your lender it is extra principal. Some lenders hold unlabelled extra money as a prepayment of next month's bill instead of reducing the balance. Check how yours applies it, and whether the loan has a prepayment penalty.
- Mortgages have more than principal and interest. Taxes, insurance and PMI are not part of amortization. For those, use the mortgage calculator or the mortgage amortization calculator.
- Rounding. Lenders round each payment to the cent, so the last payment on your statement may differ from this schedule by a few cents.
Frequently asked questions
What is an amortization schedule?
A table that splits every loan payment into interest and principal and shows the balance left afterwards. On $200,000 at 6.5% for 30 years, the first $1,264.14 payment is $1,083.33 of interest and only $180.80 of principal.
Why do I pay so much interest at the start of a loan?
Interest is charged on the balance, which is largest at the start. On a 30-year $200,000 loan at 6.5%, the principal part of the payment does not overtake the interest part until payment 233, more than 19 years in.
How much does an extra $100 a month save?
On $200,000 at 6.5% for 30 years, an extra $100 every month pays the loan off in 24 years 5 months and saves about $55,946 of interest. An extra $250 a month cuts it to 19 years 5 months.
Is one extra payment a year as good as paying a bit more each month?
Roughly. Making one extra full payment of $1,264.14 at the end of each year on the same loan saves about $55,990 and finishes in 24 years 4 months, close to adding $100 a month. Money paid earlier always saves a little more.
Does a lump sum make a difference?
Yes, especially early. A one-time $10,000 extra payment with the first payment saves about $51,031 of interest on that loan and finishes 4 years early. The same $10,000 paid after five years saves about $35,889.