Amortization Calculator
Calculate monthly loan payments and the total interest paid over the life of a loan. Shows how each payment splits between principal and interest using the standard amortization formula.
This free online amortization calculator provides instant results with no signup required. All calculations run directly in your browser — your data is never sent to a server. Enter your values below and see results update in real time as you type. Perfect for everyday calculations, homework, or professional use.
The total amount borrowed.
The annual interest rate on the loan.
The length of the loan in years.
How to Use This Calculator
Enter your input values
Fill in all required input fields for the Amortization Calculator. Most fields include unit selectors so you can work in your preferred unit system — metric or imperial, whichever matches your problem.
Review your inputs
Double-check that all values are correct and that you have selected the right units for each field. Incorrect units are the most common source of calculation errors and can produce results that are off by factors of 2, 10, or more.
Read the results
The Amortization Calculator instantly computes the output and displays results with units clearly labeled. All calculations happen in your browser — no loading time and no data sent to a server.
Explore parameter sensitivity
Try adjusting individual input values to see how the output changes. This is a quick and effective way to develop intuition about how different parameters influence the result and to identify which inputs have the largest effect.
Formula Reference
Amortization Calculator Formula
See calculator inputs for the governing equation
Variables: All variables and their units are labeled in the calculator interface above. Input fields accept values in multiple unit systems — select your preferred unit from the dropdown next to each field.
When to Use This Calculator
- •Use the Amortization Calculator when comparing financial options side-by-side — such as different loan terms or investment returns — to make more informed decisions.
- •Use it to quickly estimate costs or returns before making purchasing, investment, or borrowing decisions.
- •Use it for financial education and planning to understand how compound interest, fees, or tax affects the real value of money over time.
- •Use it when building or reviewing a budget to verify that projections and calculations are mathematically correct.
About This Calculator
The Amortization Calculator is a free financial calculation tool designed to help individuals and businesses understand key financial concepts and estimate costs, returns, and loan parameters. Calculate monthly loan payments and the total interest paid over the life of a loan. Shows how each payment splits between principal and interest using the standard amortization formula. The calculations are based on standard financial mathematics formulas. Results are for informational and educational purposes only and should not be considered financial, investment, or tax advice. Consult a qualified financial professional before making financial decisions. All calculations are performed in your browser — no personal financial data is stored or transmitted.
About Amortization Calculator
The amortization calculator computes the fixed monthly payment for a fully amortizing loan, along with the total interest paid over its lifetime. Amortization is the process of paying off debt through regular equal payments that cover both interest and principal. In the early years, most of each payment goes to interest; over time, the principal portion increases as the loan balance shrinks. This calculator is essential for anyone taking out a mortgage, car loan, or personal loan. Understanding amortization helps you see the true cost of borrowing, evaluate different loan terms, and decide whether extra payments or refinancing make financial sense.
The Math Behind It
Formula Reference
Amortization Payment
PMT = P * r(1+r)^n / ((1+r)^n - 1)
Variables: P = principal; r = monthly rate; n = total number of payments
Worked Examples
Example 1: 30-year mortgage
$250,000 mortgage at 6.5% annual rate for 30 years.
Monthly payment is $1,580 with $318,861 in total interest over 30 years.
Example 2: Car loan
$25,000 car loan at 5% for 5 years.
Monthly payment is $472 with $3,307 total interest.
Common Mistakes & Tips
- !Forgetting to divide the annual rate by 12 to get the monthly rate.
- !Not accounting for property taxes, insurance, and PMI, which increase the actual monthly housing cost beyond the loan payment.
- !Comparing only monthly payments between loan options without considering total interest paid.
Related Concepts
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Frequently Asked Questions
How much can I save by making extra payments?
Even small extra payments can save thousands. An extra $100/month on a $250,000 30-year mortgage at 6.5% saves about $62,000 in interest and pays off the loan 5 years early.
Is a 15-year or 30-year mortgage better?
A 15-year mortgage has higher monthly payments but dramatically lower total interest (often less than half). A 30-year mortgage offers lower payments and more flexibility.
What is negative amortization?
When payments are too small to cover the interest, the unpaid interest is added to the principal, increasing the loan balance. This can occur with certain adjustable-rate or payment-option mortgages.