Generate detailed amortization tables showing principal, interest, and balance for each payment period with extra payment modeling.
This tool takes a loan's principal, annual interest rate, and term, converts the rate to a periodic rate, and solves the standard amortization formula for one fixed payment amount. It then walks period by period, splitting each payment into interest charged on the current balance and principal that reduces it, carrying the new balance forward until it hits zero. Add a recurring or one-time extra payment and that amount is applied straight to principal each period it's active - which shortens the payoff term rather than lowering the fixed payment, the opposite of what most people expect.
A concrete input and expected output from the current implementation.
Input
Loan amount: $10,000; annual interest rate: 6%; term: 12 months; monthly payments; no extra payment
Expected output
Fixed monthly payment: $860.66. Month 1: interest $50.00, principal $810.66, ending balance $9,189.34. Month 2: interest $45.95, principal $814.71, ending balance $8,374.63.
The monthly rate is 6%/12 = 0.5%. Month 1 interest is 0.5% of the full $10,000 balance ($50.00); each later month's interest shrinks because it's charged on the balance left after the prior month's principal portion was subtracted.
The annual rate is converted to a periodic rate (annual rate divided by payments per year), then the level-payment amortization formula is applied: payment = principal x r x (1+r)^n / ((1+r)^n - 1), where n is the total number of periods. That single payment figure is held constant for the life of the loan unless extra payments change the payoff date.
Any extra amount entered is subtracted from principal after that period's interest has already been charged on the un-reduced balance. Because the balance drops faster, later periods carry less interest, so the schedule reaches zero in fewer periods than the original term while the regular payment amount itself stays unchanged.
No. It keeps the periodic payment the same and reduces the number of remaining periods instead. If you want a lower required payment rather than a shorter payoff, that means refinancing or having the lender re-amortize the loan, which this tool doesn't do.
Yes - apply it only in the single period you specify, and the schedule recalculates every period after that off the reduced balance. A lump sum applied early saves more total interest than the same amount applied later, since it removes principal from more remaining periods.
The example and behavioral notes were checked against the browser implementation. Standards and primary references below define the relevant format, formula, or platform behavior.
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