📋 Amortization Calculator
Generate a complete payment-by-payment amortization schedule for any fixed-rate loan. See exactly how much of each payment goes to principal vs interest, and your remaining balance every month.
Loan Details
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%
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Monthly Payment
$0
Total Principal
$0
Total Interest
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Total Cost
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Payoff Date
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Interest as % of Total
0%
Extra Pmt Savings
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■ Principal
■ Interest
How Loan Amortization Works
An amortizing loan has fixed monthly payments, but the split between principal and interest shifts dramatically over time. In the early years of a 30-year mortgage, most of your payment goes to interest. By the final years, nearly all of it reduces your principal.
Monthly Payment = P × [r(1+r)^n] / [(1+r)^n − 1]
Where P = loan amount, r = monthly rate, n = total payments
Each month: Interest = Balance × r | Principal = Payment − Interest
Where P = loan amount, r = monthly rate, n = total payments
Each month: Interest = Balance × r | Principal = Payment − Interest
Why Early Payments Matter So Much
On a $300,000 mortgage at 7% for 30 years, your first payment of $1,996 breaks down as: $246 principal and $1,750 interest. Making one extra payment per year reduces the loan by nearly 5 years and saves over $60,000 in interest.
| Extra Payment | Interest Saved (30yr/7%/$300k) | Years Saved |
|---|---|---|
| $0 extra | — | — |
| $100/month | ~$40,000 | ~4.5 years |
| $200/month | ~$67,000 | ~7.5 years |
| $500/month | ~$120,000 | ~13 years |
What is negative amortization? +
Negative amortization occurs when your monthly payment is less than the interest charged that month. The unpaid interest gets added to your loan balance, meaning you owe more over time despite making payments. This happens with certain adjustable-rate mortgages, interest-only loans, and some income-based student loan repayment plans. It is generally something to avoid.
Does extra payment go to principal automatically? +
It depends on your lender. Most major lenders apply extra payments to principal automatically, but some require you to specify. Always check your loan statement to confirm extra payments reduced your principal balance. Some lenders apply extra payments to future scheduled payments instead — which doesn't save you any interest. Contact your servicer to confirm their policy and mark extra payments as "apply to principal."
Should I refinance to a 15-year mortgage? +
A 15-year mortgage has a higher monthly payment but a lower interest rate and dramatically less total interest. On a $300,000 loan: 30-year at 7% = $1,996/month and $418,000 total interest; 15-year at 6.5% = $2,613/month and $170,000 total interest — saving nearly $250,000. If you can afford the higher payment and plan to stay long-term, a 15-year mortgage is almost always better financially. Use our calculator to compare.