Mortgage Amortization

An amortization schedule is a table detailing each periodic payment on an amortizing loan. Each calculation comes with an annual and monthly amortization schedule showing the breakdown between interest and principal for each payment period.

Each repayment for an amortized loan contains both an interest payment and payment towards the principal balance. Early in the schedule, a larger portion of each payment goes toward interest; over time, more goes toward principal. An amortization schedule helps indicate the specific amounts paid toward each, along with the interest and principal paid to date and the remaining principal balance.

Basic amortization schedules do not account for extra payments, but borrowers can still pay extra towards their loans to reduce interest costs and shorten the loan term.