📑 Amortization Calculator
See the full payment schedule for any loan — principal, interest, and remaining balance for every period.
Loan Details
Your Amortization Summary
| # | Payment | Principal | Interest | Balance |
|---|
Preview shows the first 12 payments of your amortization schedule. Estimates only — actual lender terms, fees, and rounding may vary.
How the Amortization Calculator Works
Amortization spreads a loan's repayment into equal periodic payments over a fixed term. Each payment covers the interest accrued on the remaining balance for that period, with the rest reducing the principal. Because interest is charged on a shrinking balance, the interest portion of each payment decreases over time while the principal portion grows — even though the total payment stays the same.
Formula
Number of Payments (n) = Term × Payments per Year
Payment = L × r × (1 + r)ⁿ / [(1 + r)ⁿ − 1]
(If r = 0: Payment = L / n)
Worked Example
A $25,000 loan at 6.5% annual interest over 5 years (monthly payments) works out to 60 payments of approximately $489/month. Over the full term, total payments come to about $29,340 — meaning roughly $4,340 goes to interest and the remaining $25,000 pays down the original principal. In month 1, about $135 of the $489 payment is interest; by the final month, interest is only a few dollars, with nearly the whole payment reducing principal.
How to Use This Amortization Calculator
- Enter the loan amount, annual interest rate, and loan term.
- Choose whether the term is in years or months.
- Select a payment frequency — monthly, biweekly, or weekly.
- Review the payment amount and the first 12 periods of the schedule to see how principal and interest shift over time.
Frequently Asked Questions
What is loan amortization?
Amortization is the process of paying off a loan through fixed, regular payments where each payment covers that period's interest plus a portion of the principal. Early payments are mostly interest; later payments are mostly principal.
Why does the interest portion shrink over time?
Interest for each period is calculated on the remaining balance. As the balance drops, less interest accrues, so more of each fixed payment goes toward principal.
Does this work for any loan type?
Yes. The standard amortization formula applies to mortgages, auto loans, personal loans, and any other fixed-rate, fixed-term loan with equal periodic payments.