Amortization Schedule Calculator
Watching a Loan Balance Actually Disappear
Two loans with the same payment can be paying off principal at very different speeds depending on the interest rate and term. An amortization schedule reveals what a single "monthly payment" figure hides: exactly how much of each payment goes to interest versus principal, and how that mix shifts, year over year, as the balance shrinks.
The Formula
Each month: Interest Payment = Remaining Balance × r
Principal Payment = M − Interest Payment
New Balance = Remaining Balance − Principal Payment
The fixed monthly payment M is calculated once from the principal P, monthly rate r, and number of payments n. From there, the calculator simulates the loan month by month, recalculating the interest charge against the current balance each time.
Why the Early Years Feel Slow
- Front-loaded interest — because interest is charged on the outstanding balance, early payments are mostly interest; principal only starts dominating in the later years.
- Refinancing timing — understanding how much equity you've actually built (versus how much you've paid) matters when deciding whether refinancing makes sense.
- Extra payment impact — seeing the interest/principal split clarifies why extra payments made early in a loan save far more interest than the same extra payment made later.
$250,000 Loan at 6%, 30-Year Term
| Year | Principal Paid | Interest Paid | Remaining Balance |
|---|---|---|---|
| 1 | $3,070.03 | $14,916.49 | $246,929.97 |
| 5 | $3,900.44 | $14,086.08 | $232,635.89 |
| 10 | $5,261.11 | $12,725.41 | $209,214.31 |
| 15 | $7,096.45 | $10,890.07 | $177,622.11 |
| 20 | $9,572.04 | $8,414.47 | $135,008.97 |
| 25 | $12,911.25 | $5,075.27 | $77,530.22 |
| 30 | $17,415.34 | $571.17 | $0.00 |
By year 30, the annual interest charge has fallen to a fraction of what it was in year 1, even though the payment amount never changed.
How to Use This Calculator
- Enter the Loan Amount.
- Enter the Annual Interest Rate.
- Enter the Loan Term in years.
- Select Calculate for the monthly payment, total interest, and a year-by-year principal/interest/balance summary.
Related Calculations
For the single monthly payment figure without the full schedule, use the Loan Calculator, or model a home purchase specifically with the Mortgage Calculator.