Loan Amortization Calculator

A Loan Amortization Calculator helps you determine your monthly payment (EMI) on a fixed-rate loan and shows a month-by-month breakdown of how much principal and interest you pay. It's ideal for mortgages, auto loans, student loans, or any standard installment loan.

We use the standard EMI formula, which is based on compound interest. For a loan amount (P), monthly interest rate (i), and total number of payments (n):

EMI = [ P × i × (1 + i)^n ] / [ (1 + i)^n - 1 ]

This ensures you pay off the loan in exactly (n) months with a consistent payment.

Yes! Each monthly installment splits into an interest portion and a principal portion. In the early stages, interest is a larger chunk. As the principal decreases, interest costs go down, and more of your payment goes toward principal—progressively accelerating your payoff.

Extra payments reduce your outstanding balance faster, shortening your loan term and lowering total interest. This calculator shows a standard schedule. If you want to see the effect of extra payments, you can recalculate with a reduced principal or a bigger monthly payment.

This calculator assumes a fixed interest rate. If you have an adjustable or variable rate loan, your payment schedule changes over time. You can approximate by using the initial rate or an average rate, but real payments may differ in practice.

We use standard formulas. However, rounding differences or bank-specific practices (like different compounding intervals) can cause minor variations. Use these estimates for planning; always verify final amounts with your lender’s amortization statements.

Absolutely. Our calculator provides a “Copy” button that quickly summarizes your loan amount, monthly payment, total interest, and payoff timeline. You can paste this into an email, spreadsheet, or text to keep or share your plan.

Amortized loans distribute interest across fixed monthly payments, gradually reducing the principal while keeping the payment constant. Simple interest loans, on the other hand, calculate interest only on the remaining balance, leading to lower interest costs if you pay early.

🔹 Key Differences:

If you plan to pay early, a simple interest loan could save you more in interest than an amortized loan.

Missing a loan payment could lead to late fees, increased interest costs, and credit score damage. Many lenders also apply penalty interest rates, making future payments more expensive.

🔹 Consequences of Missing Payments:

• 📌 Late fees: Can range from $25 to 5% of the monthly payment.
• 📌 Credit score drop: Late payments stay on your report for 7 years.
• 📌 Possible default: If you miss multiple payments, the lender may demand full repayment.

If you're struggling, contact your lender about loan modification options before missing a payment.

Yes! Refinancing replaces your current loan with a new loan at a lower interest rate or with better terms. This can reduce monthly payments, shorten your loan term, or save on total interest.

🔹 When Does Refinancing Make Sense?

• ✅ Interest rates have dropped since you got your loan.
• ✅ Your credit score improved, qualifying you for better terms.
• ✅ You want lower monthly payments for better cash flow.

However, refinancing may involve fees (closing costs, penalties), so check if the long-term savings outweigh the costs.

Instead of making monthly payments, some borrowers choose to pay half their monthly amount every two weeks. This results in 26 half-payments (13 full payments) per year, shaving off months or years from your loan.

🔹 Biweekly vs. Monthly Payments Example:

This strategy saves thousands in interest over the life of the loan!

A loan payoff schedule (or amortization table) lists every monthly payment, showing how much goes toward principal vs. interest. It helps borrowers visualize loan progress and plan for extra payments.

Our Loan Amortization Calculator generates an interactive payoff schedule so you can track how much interest you're paying and how different repayment strategies affect your timeline.