How to use the Amortization Calculator
An amortization schedule shows how each year of loan payments is split between interest and principal and what balance remains.
Open the Amortization Calculator →
What you need to enter
- Loan amount ($)
- Interest rate (% / year)
- Loan term (years)
The formula
Each month interest = balance × monthly rate and principal = payment − interest. The balance falls by the principal portion, so interest shrinks as the loan ages.
Worked example
Using the default values in the calculator:
- Loan amount ($): 250000
- Interest rate (% / year): 6
- Loan term (years): 30
| Monthly payment | $1,498.88 |
| Total of payments | $539,595.47 |
| Total interest | $289,595.47 |
Tips for better results
- Early payments are mostly interest, so extra payments in the first years save the most.
- Use the year-end balance column to plan a refinance or payoff date.
Common mistakes to avoid
- Assuming equal principal each month; it grows over time.
- Forgetting that taxes and insurance are not part of the amortizing balance.
Please note: Calculators and guides give general estimates, not financial, tax or investment advice. Real offers depend on your lender, location and personal situation. See our Disclaimer.