How this works
An amortization schedule shows, payment by payment, how a fixed-rate loan is paid off — exactly how much of each instalment goes to interest, how much chips at the principal, and what balance remains. The monthly payment itself stays constant (that's the whole point of "amortizing"), but its makeup shifts: early payments are mostly interest because interest is charged on a large outstanding balance, while later payments are mostly principal because the balance has shrunk. The schedule makes that arithmetic visible. The formula behind a level monthly payment is the standard amortization equation: M = P × [r(1+r)ⁿ] ÷ [(1+r)ⁿ − 1], where P is the principal, r the monthly interest rate (annual rate ÷ 12), and n the number of payments. For each month: interest = balance × r, principal = M − interest, new balance = balance − principal. Repeat for n months and you have the full table. This calculator runs that loop and surfaces both the per-payment line items and an annual summary so you can see total interest paid year by year. Why look at the schedule rather than just the monthly payment? Three reasons. (1) Comparison: a 30-year and 15-year mortgage at the same rate have very different total-interest profiles even when the monthly difference is "only" a few hundred dollars — the schedule makes the lifetime cost obvious. (2) Extra-payment planning: putting an extra $100/month against principal can knock years off the loan and tens of thousands off the interest. The schedule lets you see when the savings start to compound. (3) Tax planning: in the US, mortgage interest is deductible (subject to limits), so seeing the year-by-year interest helps with tax projections. Globally, the same idea applies to any deductible business or buy-to-let interest.
The formula
P = principal (the amount borrowed). r = monthly interest rate = annual rate ÷ 12. n = number of monthly payments = years × 12. M = constant monthly payment. balance starts at P. The schedule iterates n times, producing one row per payment.
Example calculation
- $200,000 loan at 6% APR for 30 years (360 payments). Monthly rate = 0.5%.
- Monthly payment M = 200,000 × [0.005 × 1.005³⁶⁰] / [1.005³⁶⁰ − 1] ≈ $1,199.10
- Month 1: interest = 200,000 × 0.005 = $1,000. Principal = 1,199.10 − 1,000 = $199.10. New balance = $199,800.90.
- Month 360 (final): balance reaches 0. Total interest paid over 30 years ≈ $231,676.
Frequently asked questions
Why is so much of my early payment going to interest?
Because interest is charged on the outstanding balance, and at month 1 the balance is the entire loan. On a $200,000 mortgage at 6%, the very first month's interest is $200,000 × 0.5% = $1,000 — even though your full payment is only $1,199. Just $199 of that first payment touches principal. By month 180 (year 15), the balance has dropped enough that interest is around $665 and principal is $534. By the final payment, almost all of it is principal. This isn't a trick by the bank — it's how interest math works on any positive balance — but it's why making extra principal payments early in the loan saves so much: every extra dollar at month 1 was going to compound through 30 years of interest you no longer pay.
How do extra payments change the schedule?
An extra principal payment shrinks the outstanding balance immediately, so every future month's interest is computed on a smaller number — meaning more of each subsequent payment goes to principal, and the loan ends sooner. On a 30-year, $200k loan at 6%, paying an extra $200/month shortens the loan to about 22 years and saves around $77,000 in total interest. The earlier the extra payment, the bigger the impact, because interest compounds against any balance left in the loan. Some lenders apply extra payments to "next month's scheduled payment" by default — make sure to specify "apply to principal" so it actually accelerates the payoff. The schedule above re-runs whenever you change the extra-payment input, so you can experiment.
What's the difference between APR and the rate I enter here?
The rate you enter here is the nominal interest rate — the contractual rate that drives the monthly amortization math. APR (Annual Percentage Rate, or TAEG/effektiver Jahreszins outside the US) bakes in additional costs like origination fees, points, and certain closing costs, expressing the true cost of credit on an annualised basis. APR is always equal to or higher than the nominal rate. For an apples-to-apples lifetime cost of two loans, compare APR. For computing the payment schedule, use the nominal rate. This calculator is a schedule tool, so it expects the nominal rate. If you only have APR, the resulting schedule will overestimate your total interest slightly because some "interest" in the APR is really upfront fees that aren't paid monthly.
Does this work for any loan type?
It works for any fixed-rate, fully amortizing loan with equal monthly payments — that covers most mortgages, auto loans, personal loans, and student loans (in payback). It does not handle: (1) interest-only or balloon loans, where some payments don't reduce principal; (2) variable-rate loans, where the rate changes mid-term; (3) loans with non-monthly payment frequencies (some European mortgages bill quarterly); (4) loans with mid-term payment changes such as graduated payment plans or income-driven student loan repayment. For variable-rate loans, you can model "what happens if the rate stays where it is now" by using the current rate, but actual results will differ as the rate moves. For US student loans on income-driven plans, use the loan-servicer's own simulator — the math is fundamentally different.