Amortization Schedule Calculator

You are not halfway through the debt until year 20 of 30

An amortisation schedule looks like steady progress and is not. Interest is charged on the outstanding balance, so early payments barely touch the principal. On a thirty-year mortgage you do not clear half the debt until year twenty, and principal does not exceed interest in a single payment until month 195.

How it works

• Builds the full payment-by-payment schedule, splitting each into interest and principal.
• Shows the cumulative totals, which diverge sharply from the intuition of equal payments.
• Marks the crossover point where principal finally exceeds interest.

each month:
  interest  = balance × monthly rate
  principal = payment − interest
  balance   = balance − principal

the payment is constant; the split inside it moves the whole time

Worked example

300,000 at 5% over thirty years, with a level payment of 1,610.46.

1. after 5 years: 72,114 interest paid, 24,513 principal, 275,487 owed
2. after 10 years: 137,282 interest, 55,973 principal, 244,027 owed
3. after 20 years: 238,349 interest, 148,161 principal, 151,839 owed
4. after 30 years: 279,770 interest, 300,000 principal, nothing owed

Ten years in, you have paid 137,282 of interest and reduced the debt by 55,973 — less than a fifth of it. The balance does not fall below half until month 242, two thirds of the way through the term.

Reading the result

• Principal first exceeds interest in a single payment at month 195. Before that point, most of every payment is rent on money rather than repayment of it, which is why the balance moves so slowly at the start.
• This is what makes early overpayment powerful and late overpayment nearly pointless. A unit paid in year two cancels interest across twenty-eight remaining years; the same unit in year twenty-eight cancels almost none.
• It also explains the cost of moving house frequently. Selling after five years means you paid 72,114 of interest to reduce the debt by 24,513 — and starting a new mortgage resets you to the interest-heavy beginning of a fresh schedule.
• Read the schedule before refinancing. A lower rate on a fresh thirty-year term can raise total interest even while lowering the payment, because you return to the front of the curve.

Common questions

Why does my balance barely move at first?

Because interest is charged on the whole outstanding sum, which is almost the entire loan at the start. In month one, 1,250 of a 1,610 payment is interest and 360 reduces the debt. The proportion shifts every month, but slowly.

When does the schedule start working in my favour?

Around month 195, when principal first exceeds interest in a payment, and decisively after that. The final years repay the debt quickly because there is little balance left to charge interest on.