Amortization Calculator
Estimate monthly payment and total interest for a fixed-rate loan.
What is amortization?
An amortization schedule shows how each payment is divided between interest and principal over the life of a fixed-rate loan.
About the Amortization Calculator
An amortization calculator shows how a fixed-rate loan can be paid down over time. It helps you compare monthly payments, total payments, and the amount of interest paid over the loan term.
How to use this calculator
- Enter the amount you want to borrow.
- Enter the annual interest rate.
- Choose the loan term in years.
- Review the estimated monthly payment, total payments, and total interest.
How the calculation works
The standard fixed-rate payment formula uses the loan principal, monthly interest rate, and number of monthly payments. Total payments equal the monthly payment multiplied by the number of payments, and total interest is the difference between total payments and principal.
Example
A $320,000 loan at 6.5% over 30 years produces a fixed monthly principal-and-interest estimate. Changing the rate or term shows how the payment and total interest respond.
Things to keep in mind
- Longer terms usually lower the monthly payment but can increase total interest.
- A lower interest rate can reduce both the payment and total interest.
- This calculator assumes a fixed rate and does not model every lender fee or loan feature.
- Extra payments can change a real loan's payoff schedule, but they are not modeled here.
Frequently asked questions
What does amortization mean?
Amortization is the process of paying a loan down through scheduled payments over time, with each payment allocated between interest and principal.
Does the calculator include taxes and insurance?
No. It focuses on the fixed-rate loan payment and total interest.
Why is total interest so high on a long loan?
Interest is charged over many more payment periods, so a longer repayment period can substantially increase the total interest paid.
Can I compare 15-year and 30-year loans?
Yes. Run the calculator with each term and compare the monthly payment and total interest.