The maths, with your numbers
What paying extra would do
Every dollar above the payment comes straight off the balance, so the interest stops being charged on it. These are worked out from the loan above.
How the balance falls
The same loan over different terms
| Term | Payment | Total interest | Total repaid |
|---|
A longer term lowers the payment and raises the interest. Your loan is highlighted.
Amortization schedule
Where each payment goes, from the first to the last.
An amortization schedule is the loan written out payment by payment: how much is interest, how much comes off the balance, and what is left. Every fixed-rate loan has one, and reading it is the fastest way to understand why the early years feel like nothing is happening.
What amortization means
The Consumer Financial Protection Bureau's definition is as plain as it gets: paying off a loan with regular payments, so that the amount you owe goes down with each payment. The payment stays the same; the split inside it moves. At the start most of it is interest, because interest is charged on a large balance. As the balance falls, the interest shrinks and more of each payment goes to principal.
On a 30-year mortgage at 6.25%, the crossover, the first payment where principal beats interest, arrives in year 19. The chart above marks it for your loan.
How to read the schedule
- Payment number and date. Payment 1 falls on the first payment date, not the day the money arrives.
- Interest. The balance multiplied by the rate for one period. Nothing else.
- Principal. Whatever is left of the payment after the interest is covered.
- Balance. What you still owe after that payment.
Switch to the yearly view for the shape, and the monthly view when you need to check a specific month. Both download as a spreadsheet.
Why the last payment is odd
The payment is rounded to the cent, normally up, so a few dollars of drift build up over the term. Lenders collect the difference in a slightly different final payment. Our schedule does the same, which is why the last line does not match the others.
The first period is sometimes longer
If the money is advanced more than one period before the first payment, the lender charges interest for those extra days, so the first payment carries more interest than a normal one. Regulation Z calls this an odd first period and has rules for it. Our schedule assumes a clean first period, which is the standard comparison; a lender's own schedule may differ by a few days of interest.
When a loan does not amortize
- Interest-only: payments cover only the interest for a set time, so the balance does not move at all.
- Balloon: normal payments, then one much larger payment at the end. The CFPB describes it as generally more than twice the average payment, and it is not allowed on most qualified mortgages.
- Negative amortization: the payment is smaller than the interest, so the balance grows even though you are paying. The CFPB's wording: even when you pay, the amount you owe will still go up.
Changing the shape of the schedule
Extra payments are the only lever most borrowers have, and they work by removing principal early, when interest is being charged on the biggest balance. Our extra payment calculator compares every way of doing it: a bit each month, one extra payment a year, a lump sum, or biweekly.
Quick answers
What is an amortization schedule?
A table showing every payment on a loan: the interest, the principal, and the balance left afterwards. The calculator above builds one for any fixed-rate loan and downloads it as a spreadsheet.
Why is most of my early payment interest?
Because interest is charged on the balance, and the balance is largest at the start. As it falls, the interest portion shrinks and the principal portion grows.
How do I create an amortization schedule?
Enter the amount, rate and term above. You can view it year by year or payment by payment, print it, or download the CSV.
What is negative amortization?
When the payment does not cover the interest, so the unpaid interest is added to the balance and the debt grows even though you are paying.
Does an extra payment change the schedule?
Yes. Extra money comes off the principal, so every later interest charge is smaller and the loan ends sooner. The schedule above updates when you add an extra payment.
Sources
- CFPB, what amortization is; CFPB, negative amortization
- CFPB, balloon payments; CFPB mortgage key terms, interest-only and escrow
- Regulation Z, Appendix J, unit periods and odd first periods
- 12 CFR § 1026.22, APR accuracy tolerance