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Amortization Schedule Calculator

Annual Interest Rate (APR)

Enter loan details to see the full breakdown and schedule.

Quick Tips
  • Bi-weekly Payments: Making half-payments every 2 weeks results in 13 full payments a year, shaving years off your loan.
  • Round Up: Rounding up your payment even by $50 can save thousands in interest over 30 years.
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Amortization Resources:

Disclaimer: This schedule is an estimate. Actual bank schedules may vary due to leap years, distinct compounding periods, or rounding differences.

Understanding Loan Amortization

Amortization is the process of spreading out a loan into a series of fixed payments over time. While the total payment amount remains the same each month, the components that make up that payment change.

In the beginning, your payment is primarily Interest. As time goes on, the balance shifts, and you start paying more Principal (the actual money you borrowed).

Did you know? On a 30-year mortgage, you might not pay more principal than interest until year 18 or 19! This is the power of "Front-Loaded Interest."

The Amortization Formula

Calculate your monthly payment (A) using this standard annuity formula:

A = P × r(1 + r)n
(1 + r)n - 1

  • A = Monthly Payment Amount
  • P = Principal (Loan Amount)
  • r = Monthly Interest Rate (Annual Rate ÷ 12)
  • n = Total Number of Payments (Years × 12)

This formula determines the fixed monthly payment required to pay off the loan in full over the specified term. While the formula gives you the total payment, the split between principal and interest changes every single month.

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For a deeper technical definition and financial examples, you can refer to:

How an Amortization Schedule Works

The Math Behind the Magic

Most loans use the standard annuity formula. The key takeaway is that interest is always calculated based on the current outstanding balance.

  1. Month 1: Balance is high ($500k). Interest is calculated on $500k. Result: High Interest payment.
  2. Month 60: Balance is lower ($450k). Interest is calculated on $450k. Result: Lower Interest payment.
  3. The Difference: Since your total monthly payment is fixed, the "savings" from lower interest automatically go towards paying off more principal.

Strategies to Kill Your Loan Faster

Bi-Weekly Payments

Instead of 12 monthly payments, make a half-payment every 2 weeks. That equals 26 half-payments, or **13 full payments** a year. You trick yourself into making one extra payment effortlessly.

Earmark Windfalls

Tax refund? Work bonus? Birthday money? Throw these "unexpected" chunks of cash directly at your loan principal. It creates a massive dent in future interest.

Refinance

If interest rates drop, refinancing to a lower rate (especially into a shorter term like 15 years) can save tens of thousands of dollars.

Frequently Asked Questions

Negative amortization happens when your monthly payment is less than the interest due. The unpaid interest gets added to your loan balance, meaning your debt actually grows over time. This is common in certain "Payment Option ARMs" and is very risky.

You cannot change the terms set by the bank, but you can accelerate the schedule yourself. By paying extra towards principal, you effectively jump ahead in the schedule, skipping lines of interest.

A Balloon Payment is a large lump sum due at the end of a loan term. Some loans are amortized as if they were 30-year loans (to keep payments low) but the entire balance is due after 5 or 7 years.

Simple Interest is calculated only on the principal amount (common in short-term personal loans). Amortized loans calculate interest on the declining balance. Over long periods (like mortgages), amortization is standard.