Loan Amortization Calculator
See how a fixed-rate loan is paid off year by year. Compare how much of each year's payment goes to interest versus principal, and how the balance shrinks over time.
Inputs
Results
| Year | Principal paid | Interest paid | Balance |
|---|---|---|---|
| 1 | £3,425 | £1,384 | £16,575 |
| 2 | £3,691 | £1,118 | £12,884 |
| 3 | £3,978 | £831 | £8,906 |
| 4 | £4,287 | £523 | £4,619 |
| 5 | £4,619 | £190 | £0 |
Frequently asked questions
Why does interest dominate the early years?
On a level-payment loan, the monthly payment is fixed but interest is calculated on the remaining balance. Early on the balance is high, so most of the payment goes to interest. As the balance shrinks, more of each payment chips at the principal.
How do overpayments affect this schedule?
Overpayments reduce the principal directly, which means less interest is charged in every subsequent month. Even small regular overpayments can shave years off a loan. This calculator doesn't model them yet but a version will.
Does this work for car loans and personal loans?
Yes. Any fixed-rate, fixed-term, level-payment loan follows the same amortization math: mortgages, car loans and most unsecured personal loans.