Loan Balance Amortization Schedule Calculator

A loan balance amortization schedule shows how each regular payment is divided between interest and principal, and how much remains after each payment. Enter the loan amount, annual APR, and term to calculate a fixed monthly payment, total interest, and a month-by-month estimate of the remaining balance.

Formula

For a fixed-rate loan with equal monthly payments, the payment is calculated using the standard amortization formula:

Monthly payment = P × r / [1 − (1 + r)⁻ⁿ]

• P is the starting loan principal, in dollars.
• r is the monthly interest rate as a decimal: annual APR ÷ 12 ÷ 100.
• n is the total number of monthly payments: loan term in years × 12.

The calculator rounds the resulting payment to the nearest cent. Total interest is then estimated as the rounded monthly payment multiplied by the number of payments, minus the original principal. This follows the site’s convention of using the displayed, cent-rounded payment in totals. A real lender may adjust the final payment to settle a small rounding difference.

A balance schedule uses the same monthly rate and payment. After k payments, the theoretical remaining balance is:

B_k = P(1 + r)^k − M × [(1 + r)^k − 1] ÷ r

Here, B_k is the balance after payment k, and M is the monthly payment. The payment first covers the interest accrued for that period; the remainder reduces principal. The calculator above summarizes payment and total interest. To make a full schedule, repeat the monthly calculation for each payment: interest = opening balance × r; principal paid = payment − interest; closing balance = opening balance − principal paid.

Worked Example

Using the calculator’s default inputs—$20,000 principal, 8% annual APR, and a five-year term—the monthly rate is 0.08 ÷ 12, or approximately 0.0066667. The number of payments is 5 × 12 = 60.

1. Payment = 20,000 × 0.0066667 ÷ [1 − (1.0066667)⁻⁶⁰].
2. The unrounded payment is approximately $405.53; rounded to cents, it is $405.53 per month.
3. Total paid under the calculator’s convention = $405.53 × 60 = $24,331.80.
4. Estimated total interest = $24,331.80 − $20,000 = $4,331.80.

In the first month, interest is approximately $20,000 × 0.0066667 = $133.33. About $272.20 of the $405.53 payment therefore reduces principal, leaving an estimated balance of $19,727.80. Later, interest is calculated on that smaller balance, so a larger share of the same scheduled payment goes toward principal.

Assumptions

• The APR and scheduled payment stay fixed throughout the term.
• Payments are made monthly at the end of each period, after that period’s interest accrues.
• Interest compounds monthly at APR ÷ 12; the APR is treated as a nominal annual rate for this calculation.
• Fees, taxes, insurance, PMI, escrow, late charges, and extra payments are not included.

How to Read an Amortization Schedule

A conventional schedule has one row for each payment period. It commonly shows the payment number or date, opening balance, payment amount, interest, principal reduction, and closing balance. The closing balance of one row becomes the opening balance of the next.

At the beginning of a level-payment loan, the balance is relatively large, so the interest charge is also relatively large. As principal is repaid, the interest portion usually falls and the principal portion rises. This changing split does not mean the scheduled payment itself is changing; with the assumptions above, the payment remains level.

The balance after a payment is not the same as the sum of the remaining scheduled payments. Future payments include interest that has not yet accrued. A payoff quote can also differ from the schedule’s balance because it may account for the payoff date, accrued interest, fees, or payment posting details.

When to Use It and What Can Change

An amortization schedule can help explain how a stated principal, APR, and term translate into regular payments and a declining balance. It can also provide a baseline for understanding a lender’s repayment table or comparing the effects of different hypothetical inputs. Enter the actual loan figures supplied by the lender; the default values are only an example, not a statement about available rates or loan terms.

The estimate may not match a loan if the contract uses a variable rate, irregular payment dates, daily interest accrual, a different compounding method, an interest-only period, a balloon payment, deferred interest, or a non-level payment. The APR may also include costs that are not part of the interest rate used in a simple principal-and-interest schedule. Check the loan’s disclosure for its payment amount, timing, fees, and balance calculation method.

Common Schedule Mistakes

• Mixing annual and monthly rates: Enter APR as a yearly percentage, such as 8, not as 0.08 or as a monthly rate. The formula converts it to a monthly decimal.
• Using years where months are required: The term input is in years, and the formula multiplies it by 12 to determine the payment count.
• Assuming every dollar of a payment reduces principal: Interest is charged first for the period; only the remaining payment amount reduces principal.
• Expecting exact agreement after rounding: Calculations rounded each month can differ slightly from a calculation that retains fractions of a cent. Lenders may also adjust a final payment.
• Treating a scheduled balance as a payoff quote: A payoff amount can reflect accrued interest and other contract-specific items that this estimate excludes.

Frequently Asked Questions

What does a loan balance amortization schedule show?
It shows, for each scheduled payment, how much is assigned to interest and principal and what balance remains afterward. It is based on the loan’s payment terms and calculation assumptions.

How do I calculate the balance after a payment?
Calculate that period’s interest from the opening balance and monthly rate, subtract the rest of the payment from principal, and carry the resulting balance into the next period. The balance formula in the Formula section gives the same result for level monthly payments.

Why does the interest portion decrease over time?
With a fixed rate and level payment, the balance generally declines as principal is repaid. Interest calculated on a smaller balance is lower, leaving more of the payment to reduce principal.

Does this calculator create a full month-by-month table?
No. It calculates the fixed monthly payment and estimated total interest. The schedule method described above can be repeated for each month, but the calculator does not display individual rows.

Why might my lender’s balance be different?
Possible reasons include payment dates, daily rather than monthly interest calculations, rounding, fees, extra or late payments, a changing rate, or contract-specific terms. The lender’s disclosure and account figures control the loan’s actual calculation.

This result is an estimate, and the lender’s disclosure gives the exact figures.

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in p | Loan amount | $ | 20000 | 1 | 100000000
in apr | Interest rate (APR) | % | 8 | 0.01 | 100
in yrs | Loan term | years | 5 | 0.0833 | 50
out pmt | Monthly payment | $ | round(p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)), 2) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2