Amortization Calculator
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What is an Amortization Calculator?
An amortization calculator shows you how your loan payments are applied to principal and interest over time. It generates a detailed schedule showing how much of each payment goes toward paying down the principal versus paying interest.
Understanding your amortization schedule helps you see how your loan balance decreases over time and how much interest you'll pay throughout the life of the loan. This is especially useful for mortgages, auto loans, and personal loans.
How Amortization Works
In the early years of a loan, most of your payment goes toward interest, with only a small portion reducing the principal. As time passes, the balance shifts so that more of each payment goes toward principal and less toward interest.
Example:
On a $200,000 mortgage at 4% for 30 years, your first payment might be $954.83, with $666.67 going to interest and $288.16 to principal. By payment 180 (15 years), you might pay $954.83 with $400 going to interest and $554.83 to principal.
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