Amortization Calculator
Work out the fixed monthly payment on an amortizing loan and see how much of it goes to principal versus interest over the first year.
Last updated: June 20, 2026 · Fact-checked by TG we-Calculate Editorial Team%
years
Fixed amount paid each month over the full term.
431,676.38
total paidPrincipal
46.3%
Interest
53.7%
- 1
Monthly interest rate
6% ÷ 12 ÷ 100 = 0.005 - 2
Number of payments
30 × 12 = 360 - 3
Growth factor
(1 + 0.005)ⁿ = 6.0226How much one unit grows over the full term at the monthly rate. - 4
Monthly payment
200,000 × 0.005 × 6.0226 ÷ (6.0226 − 1) = 1,199.10
First year of payments
| Month | Principal | Interest | Balance |
|---|---|---|---|
| 1 | 199.1 | 1,000 | 199,800.9 |
| 2 | 200.1 | 999 | 199,600.8 |
| 3 | 201.1 | 998 | 199,399.71 |
| 4 | 202.1 | 997 | 199,197.6 |
| 5 | 203.11 | 995.99 | 198,994.49 |
| 6 | 204.13 | 994.97 | 198,790.36 |
| 7 | 205.15 | 993.95 | 198,585.21 |
| 8 | 206.17 | 992.93 | 198,379.04 |
| 9 | 207.21 | 991.9 | 198,171.83 |
| 10 | 208.24 | 990.86 | 197,963.59 |
| 11 | 209.28 | 989.82 | 197,754.31 |
| 12 | 210.33 | 988.77 | 197,543.98 |
How is a loan payment amortized?
Amortization spreads a loan into equal monthly payments using M = P·r·(1+r)ⁿ ÷ ((1+r)ⁿ−1), where r is the monthly rate and n the number of months. Each payment covers that month’s interest first, and the rest reduces the principal until the balance reaches zero.
Formula
How this is calculated
You enter three values: the loan amount (P, the principal borrowed), the annual interest rate as a percent, and the term in years. The calculator converts these to monthly units — the periodic rate r is the annual rate divided by 12 and by 100, and the number of payments n is the years multiplied by 12 (rounded to a whole month).
It then applies the standard amortization formula M = P·r·(1+r)ⁿ ÷ ((1+r)ⁿ − 1) to find one fixed monthly payment that fully repays the loan by the final month. To build the schedule it walks month by month: each payment first covers interest on the current balance (balance × r), and whatever is left reduces the principal, so early payments are mostly interest and later ones mostly principal. Total of payments is M × n, and total interest is that total minus the original principal.
Assumptions: a constant rate, equal monthly payments, and no taxes, insurance, fees, or extra payments. A 0% rate is handled separately as P ÷ n to avoid dividing by zero.
Examples
| Input | Result |
|---|---|
| $200,000 at 6% for 30 years | Monthly payment ≈ $1,199.10; total interest ≈ $231,676 |
| $25,000 at 5% for 5 years | Monthly payment ≈ $471.78; total interest ≈ $3,307 |
| $10,000 at 0% for 2 years | Monthly payment = $416.67; total interest = $0 |
About this calculator
An amortizing loan is repaid in equal periodic payments that cover both interest and principal. Early on, most of each payment goes to interest; as the balance shrinks, a growing share goes to principal. This calculator uses the standard amortization formula to find the fixed monthly payment, then derives the total amount repaid and the total interest cost over the life of the loan.
The first-year schedule shows the principal/interest split month by month so you can see how the balance falls. When the interest rate is zero, the payment is simply the loan amount divided by the number of months.
Frequently asked questions
Amortization is the process of paying off a loan with equal periodic payments. Each payment covers the interest accrued that period, and the remainder reduces the outstanding principal.
Interest is charged on the outstanding balance, which is highest at the start. As you repay principal the balance falls, so later payments shift increasingly toward principal.
Yes. Any extra payment goes straight to principal, lowering the balance that future interest is charged on, which shortens the term and cuts total interest paid.
Also known as
Sources & references
TG we-Calculate Editorial Team. (2026). Amortization Calculator [Online calculator]. TG we-Calculate. https://we-calculate.com/calculator/amortization-calculator
TG we-Calculate Editorial Team. "Amortization Calculator." TG we-Calculate. 2026. https://we-calculate.com/calculator/amortization-calculator.
TG we-Calculate Editorial Team, "Amortization Calculator," TG we-Calculate, 2026. [Online]. Available: https://we-calculate.com/calculator/amortization-calculator
@misc{wecalculate_amortization_calculator, title = {Amortization Calculator}, author = {{TG we-Calculate Editorial Team}}, howpublished = {\url{https://we-calculate.com/calculator/amortization-calculator}}, year = {2026}, note = {TG we-Calculate} }
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