Loan Amortization Calculator
Monthly payment + full year-by-year schedule for any loan.
A loan amortization calculator computes your fixed monthly payment and shows exactly how much of each payment goes toward principal (reducing your balance) vs. interest (lender profit). Enter your loan amount, interest rate, and term — instantly see your monthly payment, total interest cost, and a full month-by-month amortization table.
How Amortization Is Calculated
The standard amortization formula computes a fixed monthly payment such that exactly zero balance remains after the final payment. The math is based on the present value of an annuity.
| Variable | Definition | Example |
|---|---|---|
| P | Principal (loan amount) | $25,000 |
| r | Monthly rate (annual ÷ 12) | 7.5% ÷ 12 = 0.625% |
| n | Total months | 5 yrs × 12 = 60 |
| Payment | Fixed monthly amount | $500.93/month |
Each month: Interest = Balance × r. Principal = Payment − Interest. New Balance = Balance − Principal. Early months are mostly interest; later months are mostly principal. At exactly the halfway point of the loan term, you will have paid off less than half the principal — this surprises most borrowers.
Worked example: $25,000 at 7.5% for 5 years. Monthly payment = $500.93. Total paid = $30,055.80. Total interest = $5,055.80. After 30 months (halfway), remaining balance = $13,527 — you've only paid off $11,473 of $25,000 principal despite making half your payments.
💡 Pro-Tip
Front-Loaded Interest Is Why Refinancing Works — and Why It Can Hurt: The amortization schedule front-loads interest. On a 30-year mortgage, you pay mostly interest for the first 10–15 years. This means if you refinance after 5 years, you restart the clock — your new loan is again mostly interest at the start. The savings from a lower rate must outweigh restarting amortization. Rule of thumb: refinancing is worth it if your new rate is 1%+ lower AND you plan to stay for 3+ more years. For shorter loans (auto, personal), refinancing math is simpler: lower rate × remaining balance × remaining months = interest saved.
Loan Amortization Calculator
Loan Details
Monthly Payment
$500.95
per month for 60 months
Loan Summary
Total Paid
$30,056.92
Total Interest
$5,056.92
Interest % of Total
16.8%
Halfway Balance
$13,249.30
after 30 months
Principal vs. Interest Split
Year-by-Year Summary
| Year | Principal Paid | Interest Paid | Balance |
|---|---|---|---|
| Year 1 | $3,936.88 | $2,074.51 | $20,718.42 |
| Year 2 | $4,242.51 | $1,768.88 | $16,104.46 |
| Year 3 | $4,571.87 | $1,439.52 | $11,132.29 |
| Year 4 | $4,926.79 | $1,084.59 | $5,774.13 |
| Year 5 | $5,309.27 | $702.11 | $0.00 |
Based on your results — what to do next:
Amortize your mortgage with PITI breakdown
At $500.95/month you're paying $5,056.92 in interest — see how a mortgage compares.
Compare auto loan scenarios
7.5% over 5 years costs $5,056.92 in interest — see if a shorter term saves more.
What if you paid more each month?
Extra payments can cut your 5-year loan significantly shorter.
Amortization Calculator FAQ
What is the monthly payment on a $30,000 loan at 8% for 5 years?
Monthly payment = $608.29. Total paid over 60 months = $36,497. Total interest = $6,497. The monthly rate is 8% ÷ 12 = 0.6667%. Use the calculator above to model any scenario instantly.
How much interest do I pay on a 30-year vs. 15-year mortgage?
On a $300,000 mortgage at 7%: 30-year payment = $1,996/mo, total interest = $418,527. 15-year payment = $2,696/mo, total interest = $185,280. The 15-year saves $233,247 in interest — but your monthly payment is $700 higher. The extra $700/month invested at 7% instead would grow to ~$389,000 over 15 years — so the 15-year isn't always mathematically optimal, but psychological debt freedom has value.
What happens if I make one extra payment per year?
On a 30-year mortgage, one extra payment annually cuts the term to ~25 years and can save $50,000–$80,000 in interest depending on loan size and rate. The extra payment applies entirely to principal, accelerating balance reduction dramatically in later years (when the interest share per payment is already declining).
Does amortization schedule differ for personal loans vs. mortgages?
The math is identical — same formula, same structure. Mortgages are typically 15–30 years, personal loans 2–7 years, auto loans 3–6 years. The difference: mortgages may have escrow (taxes + insurance) added to payments, and mortgages are secured by the property (lower rates). This calculator handles any loan type — just enter your specific terms.
What is a balloon payment loan?
A balloon loan has lower periodic payments (often interest-only or partially amortizing) with a large final "balloon" payment of the remaining principal. Example: 5-year balloon on a 30-year amortization schedule — you make 60 payments as if it were a 30-year loan, then owe the full remaining balance at year 5. Common in commercial real estate. Risk: if you can't refinance or sell at maturity, you default.