Mortgage Amortization Calculator

Amortization is the structured paydown schedule of an installment loan. Every monthly mortgage payment is the same amount, but the split between interest and principal changes dramatically over time.

In year 1 of a typical 30-year mortgage, about 75–80% of your payment goes to interest. By year 30, almost 100% goes to principal. Understanding this curve helps you make smart decisions: extra payments early are vastly more powerful than extra payments late.

The amortization schedule also reveals your true equity build. Many homeowners are shocked to find that after 5 years on a 30-year mortgage, they've only paid down ~7% of the original balance — the rest went to interest.

Use this calculator to plan refinancing decisions, evaluate the impact of a 15-year vs 30-year loan, see how extra payments accelerate equity, or simply understand what you're really paying for each month.

The amortization formula itself is straightforward: each month interest = remaining balance × (annual rate ÷ 12). Subtract that from your fixed monthly payment and the remainder pays down principal. The next month starts on a slightly lower balance, so a slightly larger share of the next payment is principal. Over 360 months that compounding shift produces the classic 'mostly interest then mostly principal' curve.

Two numbers from this schedule matter most for real decisions. First is your <strong>crossover month</strong> — the first month principal exceeds interest. On a 30-year at 6.5% it lands around month 200; at 5% it lands around month 180; on a 15-year it's already crossed by month 60. Second is your <strong>year-5 balance</strong>, which tells you the equity you'd have if you sold or refinanced in five years — a key input for the rent-vs-buy and refinance break-even decisions.

Looking at a refi? Compare the new 30-year schedule against staying with your current loan. Resetting the clock at a lower rate can either save or cost money in total interest depending on how many years you've already paid — use this schedule alongside our refinance calculator to see the lifetime numbers, not just the monthly payment.

Here's a worked example that exposes how counterintuitive amortization can be. Take a $320,000 loan at 6.5% over 30 years — payment is about $2,022/month. In month 1, interest is $320,000 × (6.5% ÷ 12) = $1,733, leaving only $289 for principal. By month 60 (year 5), interest has dropped to $1,628 and principal is up to $394. By month 240 (year 20), interest is $846 and principal is $1,176 — the crossover happened around month 195. By month 360, the final payment is almost entirely principal. Total interest over the life of the loan: $408,000 — more than the loan itself.

Extra principal payments are the single most powerful lever an amortization schedule responds to. Adding just $200/month to that same $320,000 loan eliminates 5.4 years of payments and saves about $93,000 in interest. The reason is compounding in reverse: every extra dollar permanently removes a future month of interest charges, and those savings stack across every remaining month. The earlier in the schedule you apply extra payments, the more months of interest you eliminate — which is why a $5,000 windfall in year 2 is dramatically more valuable than the same $5,000 in year 22.

Biweekly payments achieve the same effect without feeling like extra. Splitting your monthly payment in half and paying every two weeks results in 26 half-payments per year — equivalent to 13 full payments instead of 12. On a 30-year loan that one 'invisible' extra payment typically shaves 4–6 years off the term and saves tens of thousands in interest. Confirm your lender applies biweekly payments to principal immediately rather than holding them in escrow until a full month accumulates.

Amortization also matters for car loans, student loans, and personal loans — any installment loan with a fixed payment follows the same curve. Auto loans amortize faster simply because the term is shorter (typically 5–7 years), so the crossover happens within the first 1–2 years and you build equity quickly. Student loans on standard 10-year plans cross over around month 36–48. Use our generic loan calculator to model any non-mortgage installment loan with the same logic.

Finally, the amortization schedule is the foundation for understanding loan amortization as a concept — the principle that turns a fixed payment into a steadily-shrinking interest bill and a steadily-growing equity stake. If the schedule still feels mysterious, read our cornerstone guide on loan amortization for the full visual walkthrough of why early payments are 'mostly interest' and how to make that math work for you instead of against you.