Loan Amortization Calculator
Use this loan amortization calculator to work out a fixed monthly loan payment, estimate the total interest paid, and see how each payment reduces your outstanding balance. Every result comes with a month-by-month amortization schedule based on a fixed annual interest rate and equal monthly payments. It is a mathematical estimate, not a lender quote.
Run your loan numbers.
Change any value and the results, chart and schedule update instantly. Nothing leaves your device.
Changes number formatting only. No exchange-rate conversion is applied.
Loan details
Default values are examples, not live rates. Replace them with figures from your loan offer.
Results
Regular Monthly Payment
First payment: where the money goes
Whole loan: principal vs interest
Results are hidden until every field is valid. Fix the fields marked with an error message to see your payment, chart and schedule.
Remaining loan balance over time
The chart plots the remaining balance after each monthly payment from the same schedule used for the results and table. The full table below gives the exact figures.
Monthly amortization schedule
Fixed rate, equal monthly payments, no extra repayments. Actual lenders may round each payment to minor currency units, so their final balance or last payment can differ slightly from this unrounded model.
| Payment # | Opening balance | Monthly payment | Interest paid | Principal repaid | Closing balance | Cumulative interest | Cumulative principal |
|---|
Key assumptions
- Fixed annual interest rate, with monthly payments.
- Monthly interest is the annual rate divided by 12, applied to the opening balance.
- Equal scheduled payments across the term, with a negligible final-payment adjustment to clear any residual balance.
- No extra payments and no skipped or late payments.
- Taxes, fees, insurance, escrow and other lender-specific charges are not included.
- Currency selection changes formatting only. The calculator does not retrieve live lender rates.
The math behind every result.
The headline results, the schedule and the chart all use these same formulas. Only the display is rounded.
Monthly interest rate
Monthly Interest Rate = (Annual Interest Rate / 100) / 12
Convert the percentage to a decimal first, then divide by 12. For example, 6.5% becomes 0.065, and 0.065 / 12 is about 0.0054167 per month.
Number of payments
Number of Payments = Loan Term in Years × 12
A 30-year loan has 360 monthly payments. The longest term allowed here, 100 years, has 1,200.
Fixed monthly payment
Monthly Payment = P × r / (1 − (1 + r)^(−n))
P is the original loan principal, r is the monthly interest rate as a decimal, and n is the total number of monthly payments.
When the rate is 0%, that formula would divide by zero, so the calculator uses:
Monthly Payment = Loan Amount / Number of Payments
Splitting each payment
Monthly Interest = Opening Balance × Monthly Interest Rate
Principal Repaid = Monthly Payment − Monthly Interest
Closing Balance = Opening Balance − Principal Repaid
A payment is not the same as the principal repaid. Part of every payment pays the interest that built up on the balance, and only the remainder reduces what you owe. The closing balance of one month becomes the opening balance of the next.
Worked examples.
Load any example into the calculator above to see its full schedule and chart.
Example 1: Zero-interest loan
- Loan amount: 12,000
- Annual rate: 0%
- Term: 2 years (24 payments)
12,000 / 24 = 500
The monthly payment is 500, total interest is 0 and total repaid is 12,000. The model charges no interest, so all 24 payments repay principal.
Example 2: Positive-interest loan
- Loan amount: 10,000
- Annual rate: 12%
- Term: 1 year (12 payments)
12% / 12 = 1% per month
The monthly payment is about 888.49, total interest is about 661.86 and total repaid is about 10,661.86. Interest is charged on the remaining balance, so the interest portion shrinks each month as principal is repaid.
Example 3: Longer-term loan
- Loan amount: 250,000
- Annual rate: 6.5%
- Term: 30 years (360 payments)
This loan is repaid through 360 regular monthly payments. The calculator works out the exact payment from the formula, and the schedule shows the interest and principal split for every month.
What Is a Loan Amortization Calculator?
A loan amortization calculator estimates the fixed monthly payment on a loan and shows how the outstanding balance changes as you repay it. You enter the amount borrowed, a fixed annual interest rate and the loan term. The calculator returns a monthly loan payment, the total interest paid, the total amount repaid and a full amortization schedule.
Each payment contains an interest portion and a principal portion. The schedule shows how the split between the two shifts from month to month. This calculator works only from the numbers you enter. It uses a fixed annual interest rate, monthly payments and monthly interest accrual, and it does not retrieve actual lender data.
What Is Loan Amortization?
Amortization is the gradual repayment of a loan through scheduled payments over a set period. Rather than paying everything at the end, you pay a regular amount, and the outstanding balance falls a little with each payment until it reaches zero.
In a standard amortizing loan, interest is calculated on the balance still owed. Part of each payment covers that interest, and the remainder reduces the principal. Because a lower balance means less interest the following month, a larger share of each later payment goes toward principal.
How to Use This Loan Amortization Calculator
Enter the amount you actually borrowed, the fixed annual rate you are assuming and the intended term. The inputs are:
- Loan amount: the amount borrowed at the start, before any separately charged fees.
- Annual interest rate: the fixed nominal rate, from 0% to 100%.
- Loan term in years: a whole number of years from 1 to 100.
- Currency selector: changes display formatting only. It does not use exchange rates or convert your amount.
The results show:
- Monthly payment: the regular scheduled payment.
- Total interest and total amount repaid: the cost of borrowing and the sum of all payments.
- First-month interest and principal: how the first payment is divided.
- Remaining loan balance: shown after the first payment and at the end of the term.
- Monthly amortization schedule and balance chart: the full month-by-month detail and its picture.
Loan Amortization Calculator Formula
The loan amortization formula starts with the monthly interest rate and the number of payments:
Monthly Interest Rate = (Annual Interest Rate / 100) / 12
Number of Payments = Loan Term in Years × 12
The fixed monthly payment is then:
Monthly Payment = P × r / (1 − (1 + r)^(−n))
Here P is the original principal, r is the monthly interest rate as a decimal, and n is the total number of monthly payments. If the interest rate is zero, the formula would divide by zero, so the payment is simply Loan Amount / Number of Payments.
The schedule then applies two more formulas to every month:
Monthly Interest = Opening Balance × Monthly Interest Rate
Principal Repaid = Monthly Payment − Monthly Interest
Used together, these formulas produce every row of the amortization schedule.
Loan Amortization Calculation Example
Take a loan of 10,000 at a 12% annual interest rate over one year. Dividing 12% by 12 gives a monthly interest rate of 1%, or 0.01. With 12 payments, the payment formula gives a monthly payment of about 888.49.
Across all 12 payments, the total amount repaid is about 10,661.86, so total interest is about 661.86. These figures are subject to calculation precision and the final-payment convention.
For the first month, interest is calculated on the full opening balance:
10,000 × 0.01 = 100
The first month's interest is 100, and the rest of the payment, about 788.49, goes toward principal. Another lender could produce a slightly different schedule because of its own rounding rules or additional charges.
Principal vs. Interest in Loan Payments
Principal is the amount you borrowed. The part of each payment that goes to principal reduces your outstanding debt. Interest is the cost of borrowing, calculated on the remaining balance under the stated rate.
The split changes over time because interest depends on the balance. Early on the balance is high, so interest takes a large share of each payment. As principal is repaid, the balance falls, the interest charged each month drops, and more of the same fixed payment goes toward principal.
How the Monthly Amortization Schedule Works
The schedule has one row per payment, plus a starting row showing the initial balance. Its columns are:
- Payment number: the month, counted from 1.
- Opening balance: what you owe before that payment.
- Monthly payment: the amount paid that month.
- Interest paid: opening balance × monthly interest rate.
- Principal repaid: payment minus interest.
- Closing balance: opening balance minus principal repaid.
- Cumulative interest and cumulative principal repaid: running totals through that payment.
The closing balance of one month becomes the opening balance of the next. The final payment clears the remaining balance within the calculation model.
How Loan Term and Interest Rate Affect Repayment
For a fixed loan amount and a fixed positive interest rate, spreading repayment over a longer term generally lowers the required monthly payment. It also generally increases the total interest paid, because the balance stays outstanding for longer.
For the same principal and term, a higher positive interest rate generally raises both the monthly payment and the total interest. You can test both effects by changing one input at a time and watching the results update.
What Affects Actual Loan Repayment?
Real repayment can be shaped by lender fees, insurance, taxes, interest-rate changes, payment dates, payment rounding, extra payments, skipped payments and contract terms. This calculator does not model those factors automatically.
It is designed for standard fixed-rate, fully amortizing loans with monthly payments. It does not calculate an official APR and does not replace a lender's repayment schedule.
Benefits and Limitations of Loan Amortization Calculations
A loan amortization calculation is useful for:
- Estimating a monthly loan payment.
- Estimating total interest and the total repayment amount.
- Seeing how each payment reduces principal.
- Reviewing the outstanding loan balance over time.
- Understanding the difference between principal and interest.
Its limits are equally important. The model leaves out fees, taxes, insurance, changing interest rates, early repayments, lender-specific rounding and differences in payment schedules. It does not retrieve real product rates and does not give personalised financial advice. Treat the output as an educational estimate, not a promise of approval, savings or a guaranteed repayment amount.
Frequently asked questions.
What is a loan amortization calculator?
A loan amortization calculator estimates the fixed monthly payment on a loan and builds a schedule showing how each payment is divided between interest and principal. This loan amortization calculator assumes a fixed annual rate and monthly payments, and it shows how your remaining balance falls over time.
How do you calculate a monthly loan payment?
The payment is calculated from the loan principal, the monthly interest rate and the total number of monthly payments. The monthly rate is the annual rate divided by 100 and then by 12, and the number of payments is the term in years × 12. Those values go into the fixed-payment formula shown in the next answer.
What is the loan amortization formula?
For a positive rate: Monthly Payment = P × r / (1 − (1 + r)^(−n))P is the original principal, r is the monthly interest rate as a decimal and n is the number of monthly payments. If the rate is 0%, the exception is Monthly Payment = Loan Amount / Number of Payments.
How is interest calculated in an amortization schedule?
Each month, interest equals the opening outstanding balance multiplied by the monthly interest rate. The rest of the payment is principal, and it reduces the balance. The next month then starts from that lower balance, so the interest portion gradually falls.
What is the difference between principal and interest?
Principal is the amount you borrowed, and repaying it reduces your debt. Interest is the cost of borrowing, charged on the remaining balance. Each monthly payment contains both, and the share of principal rises over time under a positive fixed rate.
Does a longer loan term reduce monthly payments?
For the same principal and a positive fixed interest rate, a longer repayment period generally lowers the scheduled monthly payment. It also generally increases total interest, because the balance is outstanding for more months.
How much interest will I pay over the entire loan term?
The calculator adds up the interest charged in every monthly payment and shows it as Total Interest. It equals the total amount repaid minus the original loan amount. It is not the loan amount × rate × years, because the balance shrinks as you repay.
What happens if the interest rate is 0%?
The principal is divided evenly across all payments, with no interest charged in the mathematical model. Every payment repays principal, the balance falls by the same amount each month and total interest is zero.
Does this calculator include extra payments, fees, or insurance?
No. It assumes regular scheduled payments and does not automatically include extra repayments, fees, insurance, taxes or other lender-specific charges. It also does not retrieve lender rates or calculate an official APR.
Does changing the currency convert the loan amount into another currency?
No. Selecting INR, USD, GBP, CAD, AUD, SGD, AED, EUR or JPY changes monetary display formatting only. It does not perform foreign-exchange conversion, and it does not change the calculation.