Loan Amortization Calculator

What this tool does

The Loan Amortization Calculator splits every instalment of a fixed-rate loan into principal and interest and tracks the remaining balance. Add an extra monthly payment or a one-time prepayment to see exactly how much interest and how many months you save.

Amortisation is the process of paying off a loan through regular instalments that each cover the interest due for that month plus a slice of the principal. Because interest is charged on the outstanding balance, the first payments are mostly interest and the last ones are mostly principal. A schedule makes that shift visible and shows the exact balance you owe after any payment, which is what you need when planning a prepayment, refinancing or closing a loan early.

This calculator computes the scheduled payment with the reducing-balance formula P·r·(1+r)^n ÷ ((1+r)^n − 1) and then walks through the loan month by month. Extra payments are applied directly to principal after the scheduled instalment, so the instalment stays the same and the loan simply ends sooner. It compares the result against the same loan without prepayments and reports the interest and months saved. All maths runs in your browser.

How to use Loan Amortization Calculator

1. Pick the currency and enter the loan amount.
2. Enter the annual interest rate and the loan term in years (decimals such as 2.5 are allowed).
3. Optionally set the first payment date so the schedule shows calendar months instead of month numbers.
4. Add an extra payment every month and/or a one-time prepayment with the month in which you will make it.
5. Choose Year by year or Month by month for the schedule view.
6. Read the monthly payment, total interest, payoff time and savings, then download the schedule as CSV.

Tips for better results

• Prepay as early as you can: a prepayment in year 2 removes far more interest than the same amount in year 12, because it stops interest compounding on that money for longer.
• Run the month-by-month view before a big prepayment to find the exact balance on that date and confirm the figure with your lender.
• A small fixed extra amount every month, such as 5% of the instalment, often shortens a 20-year loan by several years.
• Check whether your lender charges a prepayment penalty; floating-rate home loans to individuals in many countries have none, but fixed-rate loans often do.

Common use cases

• Deciding whether to use a bonus to prepay a home or car loan.
• Reconciling a lender statement with the expected principal and interest split.
• Comparing the effect of a monthly top-up against a single annual lump sum.
• Preparing a loan schedule for accounting or a business plan.

Common mistakes to avoid

• Assuming the instalment drops after a prepayment; with this method the tenure shortens instead. Ask your lender if you prefer a lower instalment.
• Entering a flat or add-on rate. Some dealers quote flat rates that look lower than the equivalent reducing-balance rate this tool expects.
• Forgetting that floating rates change; the schedule is only exact while the rate stays the same.