Amortization Calculator

How to use the amortization calculator

Enter the amount you borrowed (or still owe), the annual interest rate and the term in years or months, then pick the month of your first payment so the schedule can show real dates. The monthly payment, total interest and payoff date appear at once, with the working underneath.

To test prepaying, add an amount in any of the three extra-payment boxes: a fixed extra every month, a lump sum once a year in the month you choose (a bonus or tax refund, say), or a one-time payment with a specific payment number — the hint shows its date. The results then compare the loan with and without the extras. The chart and the yearly summary total each calendar year; open any year in the monthly schedule to see its payments, or download the whole schedule as a CSV file for a spreadsheet. Your numbers stay in your browser and in the page address, so a bookmark or shared link reopens the same schedule.

The amortization formula

A fixed-rate loan repaid in equal monthly installments has the payment:

Every month the same three steps repeat:

At 0% the payment is simply P ÷ n. An extra payment skips the interest step entirely — it all comes off the balance — so every later month charges interest on a smaller balance. That is why extras shorten the loan rather than reduce the required payment. The final payment is whatever is left, so it is usually smaller than M.

Worked example

The calculator opens with a $300,000 loan at 6.5% for 30 years. The monthly rate is r = 0.065 ÷ 12 ≈ 0.0054167 and n = 360, so (1 + r)^360 ≈ 6.991798 and

M = $300,000 × 0.0054167 × 6.991798 ÷ 5.991798 = $1,896.20 a month.

• Payment 1: interest is $300,000 × 0.0054167 = $1,625.00, so only $271.20 reduces the balance.
• Without extra payments you make 360 payments and pay $382,633.47 of interest — more than the amount borrowed. Principal doesn’t overtake interest until payment 233, almost 20 years in.
• With the example’s $200 extra every month, the loan is gone after 277 payments and costs $279,184.67 of interest: $103,448.79 less, and 6 years 11 months sooner.

For comparison, a 15-year loan for the same amount and rate costs $2,613.32 a month and $170,397.98 of interest. Extra payments get you part of that saving while keeping the lower required payment as a safety net.

Before you prepay

• Check for a prepayment penalty. The CFPB explains that federal rules limit which mortgages can carry one, and that where a penalty exists it typically applies only if you pay off the whole balance — by selling or refinancing — within a set number of years (usually three or five), not when you pay extra principal in small amounts. Your loan documents say whether yours has one.
• Make sure extra money goes to principal. The CFPB advises confirming that your loan allows extra payments and that they are applied to the principal. Your monthly statement shows how each payment was split.
• Compare with other uses for the money. Paying off a 22% credit card first saves far more than prepaying a 6.5% mortgage — see the credit card payoff calculator. Keeping an emergency fund matters too: money paid into a loan is hard to get back.

What this calculator doesn’t include

The payment here is principal and interest only. A mortgage payment usually also includes property tax and homeowners insurance held in escrow, and sometimes mortgage insurance — the mortgage calculator adds those, and the home affordability calculator works out what price they allow. The rate is assumed fixed for the whole term, so for an adjustable-rate loan rerun the numbers at the possible reset rate. For car and personal loans the math is identical; the auto loan calculator adds sales tax and trade-ins. These figures are estimates for planning, not financial advice.