How to Read an Amortization Schedule: Principal, Interest and Balance

A $300,000 mortgage at 6.5% a year over 30 years costs $1,896.20 a month. Of your very first payment, $1,625.00 is interest and only $271.20 goes toward the loan itself. After twelve payments — $22,754.40 out of your pocket — you still owe $296,646.88. That is not a mistake in the math. It is how an amortizing loan works, and the amortization schedule is where you can watch it happen.

An amortization schedule is the month-by-month table of a loan: what you pay, how each payment splits between principal and interest, and how much you still owe afterward. Lenders hand it out as a long document that few people read. Once you know what each column means, it answers most questions about a loan: when the balance really starts to fall, how much a year of payments reduces your debt and what the loan costs in total.

Loan Calculator builds the full schedule for any loan you enter, in a monthly or yearly view, with real due dates, two charts and export to PDF, CSV or an image.

What should you compare?

Reading a schedule is mostly comparing columns with each other, and rows over time. Four numbers carry the story:

• Payment — the amount due each month. With equal payments it stays the same until the last row.
• Interest — the remaining balance times the monthly rate (annual rate ÷ 12). It shrinks as the balance shrinks.
• Principal — whatever is left of the payment after interest. This is the only part that reduces your debt.
• Remaining — the balance after the payment. It is the number to watch if you plan to sell, refinance or repay early.

Amortization schedule at a glance

Selected rows for $300,000 at 6.5% a year over 360 months, equal payments:

The payment barely moves, but the split inside it flips. Principal overtakes interest only in month 233 — more than 19 years in — and the balance first drops below half of the loan in month 257.

1. The columns: how one row is calculated

Best for: checking any lender's schedule line by line.

Every row follows the same three steps. Take month 1:

Interest  = remaining balance × annual rate ÷ 12
          = 300,000 × 6.5% ÷ 12 = $1,625.00
Principal = payment − interest
          = 1,896.20 − 1,625.00 = $271.20
Remaining = previous balance − principal
          = 300,000 − 271.20 = $299,728.80

Month 2 starts from $299,728.80, so its interest is $1,623.53 and its principal $272.67. The payment is unchanged; the extra $1.47 of principal is exactly the $1.47 less interest. Small at first, the effect snowballs: by month 120 the same payment carries $515.79 of principal, and by month 240 about $986.

Amounts are rounded to the cent every month, so the last row settles whatever is left. Here the final payment is $1,900.91 instead of $1,896.20 — it clears exactly the $1,890.67 still owed plus $10.24 of interest.

In the app the table uses the same columns, labeled #, Payment, Principal, Interest and Remaining. The line under the table — "Worked out as: Equal payments (annuity) · annual rate ÷ 12…" — tells you which method and day count produced the numbers, so you know what you are comparing against your lender's version.

2. Why the balance falls so slowly at first

Best for: understanding the early years of a long loan before you sign.

In year one, 85.3% of what you pay is interest. The yearly totals show how slowly that changes:

After ten years of payments you have repaid $45,670.86 of the $300,000. Over the whole term the loan costs $382,636.71 in interest — more than the amount borrowed.

This is also why extra payments early in a loan save so much: every dollar of principal you repay removes interest from all the rows that follow. Another way to change the split is equal principal, where the principal part is fixed and the payment falls over time; see equal payment vs equal principal.

3. Monthly or yearly view, with real due dates

Best for: long loans where 360 rows are too many to scroll, and matching the schedule to your bank statement.

1. Enter the Loan amount, Annual interest rate (%/year) and Term, tap Calculate, then tap Amortization schedule.
2. Switch between Monthly and Yearly. A yearly row adds up 12 payments, and its Remaining column shows the balance at the end of that year. As the hint says, "Tap a year to jump to its 12 payments."
3. In the monthly view, the chips Y1 to Y30 above the table jump to the first payment of each year.
4. Tap Set 1st payment date and pick the date of your first installment. The button then reads "1st payment:" with that date, every month row shows its due date, and every year row shows the calendar year in which that loan year ends.

The schedule opens with the interest method you chose on the form. You can switch it between Equal payment, Equal principal and Flat rate on the schedule screen to see the same loan under each method — useful when a store quote and a bank quote use different methods, as explained in flat rate vs reducing balance.

4. Charts: the donut and the balance curve

Best for: seeing the whole loan at a glance, or explaining it to someone else.

Open the Charts tab next to Table.

• Principal vs interest is a donut of everything you will pay. For this loan the center reads "56.1% interest": of $682,636.71 in total payments, $382,636.71 is interest.
• Remaining balance over time draws the Remaining column as a curve. On a 30-year loan it stays high for years, then bends down more and more steeply — the same story as the table, in one picture.

The charts always use the monthly rows, whichever view the table is in.

5. Export: PDF, CSV and a summary image

Best for: sharing the schedule with a partner, a broker or an accountant, or keeping a copy with your loan papers.

• Export PDF creates a printable schedule with a summary line and the "Worked out as" note. It is free with a small "Loan Calculator · free version" watermark. Pro removes the watermark and can add your name, phone and logo from Branding on quotes.
• Export CSV gives the rows as a spreadsheet file you can open in Excel or Google Sheets. It is part of Pro.
• Share image creates a one-page "Loan summary" picture with the amount, rate, term, total interest and total paid — plus the APR and total cost when you entered fees. It is free.

Exports follow what is on screen: monthly or yearly rows, and due dates if you set a first payment date. Everything is calculated and built on your phone, so the schedule only leaves it when you share the file yourself.

Which view should you use?

FAQ

Why is most of my early payment interest?

Interest is charged on the balance you still owe, and at the start you owe almost everything. On $300,000 at 6.5%, the first month's interest alone is $1,625.00 of a $1,896.20 payment. As the balance falls, interest falls with it and more of the same payment goes to principal.

Why is the last payment different from the others?

Each month's figures are rounded to the cent. The tiny rounding differences add up over the term, and the final row settles them so the balance ends at exactly zero. On this loan the last payment is $1,900.91 instead of $1,896.20.

Why doesn't my bank's schedule match exactly?

Your lender may charge interest on the actual number of days in each period, so a 31-day month costs more than a 28-day one. It may also round differently or add fees. Loan Calculator uses annual rate ÷ 12 by default; if your contract counts actual days, turn on Charge interest on actual days (365) under Advanced options.

Can I open the schedule in Excel?

Yes, with Export CSV, which is part of Pro. The free Export PDF is the better choice for reading and printing.

What does a yearly row show?

The sum of that year's 12 payments, split into principal and interest, and the balance left at the end of the year. Tap the row to jump to its 12 monthly payments.