DIY Cost Tools
Amortization Calculator
FINANCIAL CALCULATOR
Estimate a fixed loan payment and see how the first payment divides between principal and interest.
How it works
The calculator uses equal monthly payments for a fully amortizing fixed-rate loan. Early payments generally contain more interest because the balance is larger.
Formula
Payment = principal × r × (1 + r)n ÷ [(1 + r)n − 1], where r is the monthly rate and n is the number of payments.
Worked example
For a $250,000 loan at 6.5% for 30 years, the live results show the payment, first-month split, and lifetime interest.
Important limits
- Taxes, insurance, fees, changing rates, and late or extra payments are excluded.
- Rounding can make the lender’s final payment slightly different.
- This is an educational estimate, not a loan quote.
Frequently asked questions
Why does principal grow over time?
As the balance declines, monthly interest declines, leaving more of the fixed payment for principal.
Can the interest rate be zero?
Yes. The calculator divides principal evenly by the number of payments.
Sources and review notes
The Consumer Financial Protection Bureau explains how amortizing payments divide between principal and interest. Last reviewed September 29, 2026.