An amortization schedule shows where each payment goes: early on mostly interest, later mostly principal. Enter loan amount, rate and term for a year-by-year breakdown.
The schedule explains why extra payments early in the loan are so powerful — they eliminate balance that would have accrued interest for decades. Use the Debt Payoff calculator to quantify it.
It also shows your equity build-up over time, useful when weighing refinancing or early-repayment decisions.
The split is entirely a consequence of interest being charged on the outstanding balance. On a 30-year loan at 6%, more than half of the first year’s payments are interest, while in the final year almost all of it is principal. Nothing about the payment changes — only the balance it is charged against.
This is also why an early overpayment is worth so much more than a late one. A euro paid off in year two removes twenty-eight years of interest on that euro; the same euro in year twenty-eight removes two. The schedule is the clearest way to see the difference before deciding.
Some loans are not amortising at all. Interest-only periods leave the balance untouched, and any loan with a balloon payment defers principal to a single date at the end. Both produce a lower monthly figure and a schedule that looks nothing like the one here.
Frequently asked questions
What is an amortization schedule?
A table showing, for each period of the loan, how much of the payment goes to interest, how much repays principal, and the balance still owed.
Why is the interest share so high at the start?
Because interest accrues on the outstanding balance, which is largest at the beginning. As the balance falls, ever more of the constant payment goes to principal — the shift accelerates over time.
How do extra payments change the schedule?
Every extra euro reduces the balance immediately, so all future interest is computed on less. Early extra payments are the most powerful, and typically shorten the term rather than the payment.