Amortization Calculator
An amortization schedule shows exactly where every loan payment goes. Enter any loan — mortgage,
auto, personal, or student — and this calculator builds the complete month-by-month table: payment,
principal, interest, cumulative interest, and remaining balance, plus your payoff date and the true
total cost of the loan.
How amortization works
With a fixed-rate loan, your payment stays the same every month, but its composition changes constantly.
Each month, interest is charged on the current balance (annual rate ÷ 12 × balance). Whatever
is left of the payment reduces the principal. At the start of a $100,000 loan at 5%, the first payment of
$1,060.66 contains $416.67 of interest and only $643.99 of principal. By the final year, the split has
flipped: almost the entire payment is principal. This slow-then-fast balance decline is why the balance
curve bends downward more steeply near the end of the loan.
Reading your schedule
The cumulative interest column is the one most borrowers never see — and the most
revealing. It shows the running total you have paid the lender for the privilege of borrowing. On long
loans it routinely exceeds the amount borrowed: a 30-year mortgage at 7% costs more in interest than the
original loan itself. Watching this column grow is often the motivation borrowers need to start making
extra payments or to choose a shorter term next time.
The power of extra payments
Extra payments attack the principal directly, and every dollar removed early avoids interest for the
entire remaining life of the loan. On the example above, adding $100/month cuts about a year off the
10-year term and saves roughly $3,100 in interest. The effect grows with the rate and the term: on a
$320,000, 30-year mortgage at 7.26%, $100/month extra saves about $75,000 — and $200/month saves
six figures. Add an extra amount above and compare the
payoff dates — this calculator shows both scenarios side by side. For a home loan with taxes,
insurance and PMI, use our
mortgage calculator instead.
What is amortization? Two meanings
The word is used in two related ways. In lending, amortization means repaying a debt through a series of
equal installments over a fixed period — the process this calculator models. In accounting, it means
spreading the cost of a long-lived asset across the years it is used, so that no single period absorbs the
full expense. The two ideas share one logic: a big amount, broken into smaller pieces over time.
Loans that are not amortized
Not every debt follows a schedule like the one above. Credit cards are revolving debt: the
balance can rise and fall freely and the monthly amount repaid is up to the borrower, so there is no fixed
payoff path. Interest-only loans charge only interest for an initial period, leaving the
principal untouched until later. Balloon loans keep payments small for years and then demand
one large final payment of the remaining principal. An amortization schedule only applies to fully
amortizing, fixed-rate installment loans.
Amortization in accounting
Businesses amortize the cost of intangible assets — things with value but no physical
form. Under Section 197 of the U.S. tax code, most intangibles acquired with a business are amortized evenly
over 15 years. Common examples include patents, copyrights, trademarks and trade names, non-compete
agreements, customer lists and relationships, licenses and permits, and franchises. One important exception:
goodwill and other intangibles with an indefinite life, or assets a business creates itself, may not be
amortized for tax purposes. Business startup costs follow a similar pattern — a limited
amount can be deducted in the first year, with the rest amortized over 15 years.
FAQ
What is an amortization schedule?
A complete table of loan payments showing, for every month, the interest portion, the principal portion, cumulative interest, and the remaining balance until payoff.
Why is so much of my early payment interest?
Interest is charged on the outstanding balance, which is at its largest at the start. As the balance declines, interest shrinks and principal repayment accelerates — even though the payment itself never changes.
Can I download my schedule?
Yes — use the “Download Schedule (CSV)” button above the results to save the full monthly table for Excel or Google Sheets, or copy the share link to revisit the exact same calculation later.
Disclaimer: This calculator provides estimates for educational purposes only and does not constitute financial
advice. Actual payments may differ due to fees, exact payment dates, and lender rounding. Consult your lender
for the official amortization schedule of your loan.