Follow how a home-loan balance falls over time as payments cover interest and repay principal.
Mortgage Amortization Calculator
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Table of Contents
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What is Mortgage Amortization?
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How to Use This Calculator
- Enter or select Home Price, Down Payment, Interest Rate, Loan Term (Years), Property Taxes. Complete any remaining fields required by your chosen method.
- Check the unit beside each measurement. For a percentage or rate, use the scale and time period stated in the form.
- Choose Calculate, then compare the output with the formula and example below. If you change a value or option, calculate again to update the result.
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Formula Used
Payment = P × r/(1−(1+r)^−n); at zero interest, payment = P/n. P is financed principal, r is the rate per payment period and n is the number of payments.
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Variables Explained
| Input | What it means |
|---|---|
| Home Price | The property purchase price before the down payment and financing adjustments. |
| Down Payment | The part of the purchase price paid upfront rather than financed. |
| Interest Rate | The quoted rate for the time basis shown in the form; an annual rate is not a monthly rate. |
| Loan Term (Years) | The planned repayment duration, in the selected years or months. |
| Property Taxes | The property-tax allowance for the time basis shown by the input. |
| Home Insurance | The homeowners-insurance allowance; check whether the form expects a monthly or annual amount. |
| PMI Insurance | The mortgage-insurance allowance included in the housing-cost estimate. |
| HOA Fee | The homeowners-association fee for the interval stated on the form. |
| Other Costs | Use the measured or stated value for this item, with the unit or category shown beside the field. |
| Start Date | The calendar date for this event; the order of start and end dates affects the interval. |
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Worked Example
A principal of 10,000 at 6% annual interest over 12 monthly payments gives r=0.06/12 and a payment of about 860.66 before fees.
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Why Use This Calculator?
Look at both the payment and total interest. A longer term can lower the regular payment while increasing the amount paid overall.
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Common Mistakes
- Match the interest period to the payment period. Taxes, insurance, fees and extra payments affect the total only when included in the form.
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Frequently Asked Questions
Does the payment include every borrowing cost?
The principal-and-interest formula covers the loan itself. Add the fees and other costs shown in the form, and compare the estimate with the lender’s actual schedule.
Does the payment include every borrowing cost?
The principal-and-interest formula covers the loan itself. Fees and other costs are included only where the form explicitly adds them; compare the estimate with the lender’s actual schedule.
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Sources & References
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