Loan Amortization Calculator
Calculate your monthly payment, total interest, and year-by-year amortization schedule for any loan amount, interest rate, and term.
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Frequently asked questions
What is amortization?
Amortization is the process of spreading loan repayments across a fixed term. Each payment covers both interest and principal. Early in the loan, most of each payment goes to interest; near the end, most goes to principal. This front-loaded interest structure is why paying extra toward principal early saves a disproportionate amount of total interest.
How can I pay off my mortgage faster?
The most effective strategies: (1) Make one extra payment per year — this typically shaves 4-6 years off a 30-year mortgage. (2) Apply windfalls (tax refund, bonus) to principal. (3) Round up monthly payments — even an extra $50-100/month matters. (4) Refinance to a 15-year term if rates are favorable. Every dollar of early principal repayment eliminates future compounding interest.
What is the interest vs. principal ratio in early payments?
On a 30-year mortgage at 6.5%, your first payment is roughly 81% interest and 19% principal. By year 15 it is closer to 55% interest / 45% principal. By year 28 it flips to mostly principal. This is why the amortization schedule is so important — it shows exactly when your money stops mostly financing the bank and starts building equity.