AMORTIZATION CALCULATOR
Monthly Payment
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Total Interest
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Total Payoff
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| Month | Payment | Principal | Interest | Balance |
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What is Amortization?
Amortization is the process of paying off a debt over time through regular installments. Unlike a simple interest calculation, an Amortization Schedule shows you how each payment is split between the interest charged by the lender and the principal balance of the loan.
How It Works
In the early stages of a loan, a larger portion of your monthly payment goes toward interest. As the principal balance decreases, the interest portion also drops, and more of your payment starts going toward the actual loan balance. This tool helps you visualize that transition clearly.
Key Benefits
- Financial Planning: See exactly when your loan will be paid off.
- Interest Savings: Understand how a lower interest rate or shorter term reduces the total cost of borrowing.
- Tax Preparation: For mortgages, the interest portion is often tax-deductible in many regions.