Loan amortization made visible: the month-by-month principal and interest split, running balance, and what extra monthly payments save in interest and payoff time.
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FORMULA USEDLoan Amortization Calculator
What an amortization schedule shows
Every scheduled payment, split. Interest for the month is the outstanding balance × monthly rate (APR ÷ 12); the rest of the payment retires principal, and the balance column shows what you still owe after each payment. Early rows are interest-heavy by construction — the balance is at its peak.
How extra payments rewrite the schedule
An extra dollar paid with any payment goes straight to principal and eliminates every future interest charge on that dollar. The required payment does not change — the term shortens instead. On the default $240,000 loan at 6.5%, $200 a month extra ends it about 98 payments early and saves roughly $96,000.
15-year vs 30-year schedules
A 15-year term pays principal down nearly twice as fast, so interest barely accumulates: on $240,000 at 6.5%, about $136,000 of total interest versus $306,000 for the 30-year. The price is a higher required payment — and 15-year loans usually price half a point to a point lower, widening the gap.
What this model assumes
A fixed rate, payments made on schedule, and extras applied to principal immediately with no prepayment penalty. Adjustable-rate mortgages re-amortize at every reset. Property tax, insurance, and PMI are outside this schedule — the Mortgage Calculator covers the full payment.
Worked example
A $240,000 loan at 6.5% fixed for 30 years: $1,516.96 per month.
By payment #360 the interest portion is about $8 — the split inverts as the balance falls.
Add $200 extra each month and payoff arrives around payment #262, saving about $96,000.
How to use it
Enter the loan amount, fixed rate, and term in years.
Optionally add an extra monthly amount and a one-time principal payment (applied at #12).
Read the payment, payoff length, and interest saved versus the baseline schedule.
Scan the table: the first 12 payments in full, then year-end checkpoints.
Frequently asked questions
What is a loan amortization schedule?
A table of every scheduled payment split into interest and principal, with the running balance after each one. Interest each month equals the outstanding balance times the monthly rate, so the interest share shrinks as the loan ages.
Why are my first payments mostly interest?
Because the balance — the base the rate is applied to — is at its maximum in month one. On the default loan, payment #1 is $1,300.00 interest and $216.96 principal; payment #360 is about $8 interest and nearly all principal.
How do extra principal payments affect the schedule?
They shorten the term, not the required payment. Each extra dollar skips every future interest charge on it: the default $240,000 loan with $200 extra monthly pays off in about 262 payments instead of 360 and saves roughly $96,000.
How do 15-year and 30-year amortization schedules compare?
The 15-year builds equity almost twice as fast and cuts total interest roughly in half — about $136,000 versus $306,000 on $240,000 at 6.5%. In exchange, the required payment is several hundred dollars higher every month.
Can an amortization schedule change over time?
A fixed-rate schedule changes only if you pay extra, refinance, or recast. An adjustable-rate mortgage re-amortizes at every rate reset, which reshuffles the principal–interest split even on the same balance.
What is the difference between amortization and recasting?
Recasting pays a lump sum and re-amortizes the smaller balance over the remaining term, lowering the required payment. Plain extra payments, modeled here, keep the payment the same and shorten the term instead.