Amortization Schedule
A table showing the breakdown of each loan payment into principal and interest over the life of the loan.
What is Amortization Schedule?
An amortization schedule is a complete table of periodic loan payments showing the breakdown of each payment into principal reduction and interest charges over the entire loan term. Because interest is calculated on the outstanding balance, early payments are mostly interest while later payments are mostly principal — even though the total monthly payment stays constant (for fixed-rate loans). For a 30-year mortgage, the first payment might be 80% interest and 20% principal, while the final payment is nearly all principal. The schedule also shows the remaining loan balance after each payment. Amortization schedules are used for mortgages, auto loans, student loans, and any installment loan.
Example
On a $300,000 30-year mortgage at 6.5%, the monthly payment is $1,896. Payment 1: $1,625 interest + $271 principal (remaining balance: $299,729). Payment 180 (year 15): $1,133 interest + $763 principal. Payment 360: $10 interest + $1,886 principal. Total interest paid over 30 years: approximately $382,600.