What is loan amortization?

Loan amortization is the process of paying off a debt over time in regular installments. Each payment consists of both a principal portion and an interest portion. An amortization schedule is a table that details how each payment is broken down over the life of the loan.

Why is more interest paid at the beginning of the loan?

In the early stages of a loan, the principal balance is at its highest. Since interest is calculated on the outstanding balance, the interest component of your EMI is largest at the beginning. As you pay down the principal over time, the interest portion of each subsequent payment decreases, and more of your payment goes towards the principal.

How can an amortization schedule help me?

An amortization schedule provides financial clarity. It shows you exactly how much of each payment reduces your debt versus how much is an interest cost. This is useful for understanding the true cost of your loan, planning for prepayments to save on interest, and for tax purposes, as the interest paid on home loans can often be claimed as a tax deduction.

Loan Amortization Calculator

See a detailed month-by-month breakdown of your loan payments.

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Interest Rate (% p.a.)

Loan Tenure (Years)

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About the Amortization Calculator

Understand the journey of your loan from start to finish.

What is a Loan Amortization Schedule?

An amortization schedule is a complete table of periodic loan payments, showing the amount of principal and the amount of interest that comprise each payment until the loan is paid off at the end of its term. While each monthly payment (EMI) is the same, the portion that goes towards principal and interest changes over time. In the beginning, a larger portion of your payment goes to interest because the outstanding loan balance is at its highest. As the loan matures and you pay down the principal, the interest portion of your EMI decreases, and more of your payment goes toward paying down the principal itself. This calculator provides a transparent, month-by-month view of this entire process.

How to Use This Calculator

To generate your loan amortization schedule, simply enter the total Loan Amount you wish to borrow, the annual Interest Rate offered by your lender, and the Loan Tenure in years. Once these details are entered, click the "Generate Schedule" button. The calculator will first display a high-level summary of your loan, including your fixed monthly EMI, the total interest you will pay over the entire loan period, and the total amount you will have paid back. Below this summary, you will find a detailed, scrollable table showing the month-by-month breakdown of each payment into its principal and interest components, along with your remaining loan balance after each payment.

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Practical Applications

This tool provides a detailed amortization schedule for your loan, which is useful for several practical purposes:

Financial Transparency: See exactly where your money is going each month. This helps you understand the true cost of your loan over time and provides a clear picture of your debt repayment journey.
Prepayment Strategy: By knowing your outstanding principal balance at any point, you can strategize about making prepayments. Making extra payments directly towards the principal can significantly shorten your loan term and save you a large amount of interest. This schedule helps you see the impact of such decisions.
Tax Planning: For home loans in India, the interest component of your EMI is eligible for tax deductions under Section 24(b). This schedule provides you with the exact interest paid annually, which is essential for accurate tax filing and maximizing your deductions.
Loan Management: Track your loan repayment progress and stay on top of your financial obligations. It provides a clear roadmap to becoming debt-free and helps you verify that your lender's statements are accurate.