Amortization Calculator

How amortization works

When you take a fixed-rate loan, you pay the same amount every month — but what that payment does changes over time. Each month, interest is charged on your remaining balance, and whatever is left of your payment reduces the principal. Because the balance is largest at the start, early payments are mostly interest and barely dent what you owe. As the balance shrinks, more of each payment goes to principal, and the loan pays down faster and faster toward the end. That shifting split is what an amortization schedule shows.

How the monthly payment is calculated

The fixed payment comes from the standard amortization formula: P × r ÷ (1 − (1 + r)⁻ⁿ), where P is the loan amount, r is the monthly interest rate (your APR ÷ 12), and n is the total number of monthly payments. This calculator computes that payment, then walks the loan month by month to build the full schedule and total interest.

Reading the schedule

The table above summarizes each year: how much principal and interest you paid that year and your balance at year-end. Switch to the monthly view to see every individual payment. Notice how the principal column starts small and grows while the interest column does the opposite — that crossover is the heart of how loans amortize.