About Amortization Calculator
Visualize your loan payoff journey with our advanced Amortization Calculator. This tool generates a comprehensive month-by-month breakdown of your payments, providing a clear picture of how much contributes to reducing the principal balance versus covering interest charges. By understanding your amortization schedule, you can make informed decisions about refinancing, making extra payments, or simply tracking your progress. New Feature: One of the most powerful aspects of this tool is the Extra Payment calculator. By simulating additional monthly contributions, you can instantly see the impact on your loan term and total interest paid. Even small extra payments can shave years off a 30-year mortgage and save thousands of dollars. Key Concepts: Monthly Payment: The fixed amount paid each month to ensure the loan is paid off by the end of the term. Interest Portion: Since interest is calculated on the remaining balance, this portion is highest at the start of the loan and decreases over time. Principal Portion: The part of the payment that reduces your debt. This increases over time as the interest portion decreases. Formula Used: Monthly Payment (M) = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ] where P is the principal, i is the monthly interest rate, and n is the total number of payments.