Enter the loan amount, rate and term to get the monthly payment and a complete amortization schedule. Add an extra monthly payment to see how much sooner the loan is gone and how much interest you save.
Amortization calculator
Monthly payment
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Show amortization schedule
How it works
Amortization means paying a loan off in equal instalments. Every payment is the same, but the split changes: early payments are mostly interest, because interest is charged on a large balance; later payments are mostly principal.
M = P × r ÷ (1 − (1 + r)−n)
M — monthly payment
P — loan amount
r — yearly rate ÷ 12 ÷ 100
n — number of monthly payments
Each month the interest is the balance times r; the rest of the payment reduces the balance. Any extra payment goes straight to the balance, so it cuts every later month's interest as well — that is why small extra payments early in a loan save so much.
Common questions
Why is so little principal paid at the start?
Interest is worked out on the balance still owed. At the start the balance is at its highest, so most of the fixed payment is interest. The share going to principal grows every month.
Is it better to pay extra every month or once a year?
Monthly is slightly better, because the balance — and the interest charged on it — drops sooner. The difference is small; what matters most is paying extra early in the loan.
Does my lender use the same schedule?
Most fixed-rate loans use exactly this method. Some lenders round differently or charge interest daily, so the last payment can differ by a few units of currency.