Loan Amortization Calculator
Loan Amortization Calculator
The full repayment schedule of a loan: the EMI, and for every year the balance you start with, the interest and principal your instalments pay, and the balance left at the end.
Loan amortization schedule
A loan of $10,00,000 at 9% a year for 20 years
EMI and the balance after m instalments
- P
- the loan amount
- r
- the monthly rate: annual rate ÷ 12 ÷ 100
- n
- the number of monthly instalments: years × 12
- B
- the balance after m instalments. A year’s principal is the fall in the balance over the year; its interest is the EMIs paid in the year minus that principal.
Worked example
A loan of $10,00,000 at 9% a year for 20 years
r = 9 ÷ 12 ÷ 100 = 0.0075; n = 240
EMI = 10,00,000 × 0.0075 × 6.0092 ÷ 5.0092 = $8,997
First instalment: interest 10,00,000 × 0.0075 = $7,500; principal 8,997 − 7,500 = $1,497
Year 1: interest $89,240, principal $18,727, closing balance $9,81,273 — interest is 82.7% of the year's EMIs
Principal first makes up at least half an instalment at EMI number 149, in year 13
Over 20 years: $21,59,342 repaid, $11,59,342 of it interest
The schedule for 10 lakh at 9% over 20 years, selected years
| Year | Opening balance | Interest | Principal | Closing balance |
|---|---|---|---|---|
| 1 | $10,00,000 | $89,240 | $18,727 | $9,81,273 |
| 2 | $9,81,273 | $87,483 | $20,484 | $9,60,789 |
| 5 | $9,13,877 | $81,161 | $26,806 | $8,87,070 |
| 10 | $7,52,229 | $65,997 | $41,970 | $7,10,259 |
| 15 | $4,99,140 | $42,256 | $65,711 | $4,33,428 |
| 19 | $1,96,942 | $13,908 | $94,059 | $1,02,883 |
| 20 | $1,02,883 | $5,084 | $1,02,883 | $0 |
Reading an amortization schedule
Amortization is the paying-off of a loan in instalments. Each month the lender charges interest on the balance still owed — the annual rate ÷ 12 — and whatever is left of the EMI after that interest reduces the balance. The EMI stays the same, so as the balance falls the interest part shrinks and the principal part grows. On $10,00,000 at 9% for 20 years, the first instalment of $8,997 is $7,500 interest and only $1,497 principal; across the first year 82.7% of what you pay is interest. Principal first makes up half an instalment at EMI number 149, in year 13 — well past the middle of the tenure — and the balance does not fall to half the loan until year 14.
The table and chart are by year because a 20-year loan has 240 monthly rows. A monthly schedule is the same EMI split month by month in exactly the same way, and a year’s figures are the sum of its twelve months; the formula above gives the balance after any number of instalments. The EMI and totals agree with the EMI calculator for the same inputs.
Why it matters. The early years are when a prepayment saves the most, because every rupee of principal repaid early stops being charged interest for the rest of the loan; the loan prepayment calculator works out by how much. The opening balance for any year is also what you would owe if you closed or moved the loan then — the starting point for the balance transfer calculator. The interest-paid column is what a lender’s annual interest certificate reports, which matters where home-loan interest is relevant to tax; this page does not work out any tax benefit, because the rules differ by country and change.
Real loans differ from the schedule in a few ways. On a floating-rate loan the rate is reset and the lender changes the EMI or the tenure. Lenders may count interest by days in the month, so the actual split drifts by a few rupees from this one. A part-disbursed loan for a home under construction pays interest only (pre-EMI) on the amount drawn until the EMIs start. Your lender’s repayment schedule, given with the Key Facts Statement, is the binding version. This is arithmetic on the figures you enter, not financial advice.
Frequently asked questions
What is a loan amortization schedule?
A table of every instalment showing how much goes to interest, how much to principal and the balance left after it. This page shows it by year; each year is the sum of its twelve monthly rows.
Why is most of my EMI interest in the first years?
Interest is charged on the balance still owed, which is largest at the start. On $10,00,000 at 9% for 20 years, 82.7% of the first year’s EMIs is interest.
When does principal overtake interest?
When the balance has fallen far enough that the month’s interest is less than half the EMI. On the example loan that is instalment 149, in year 13 of 20. A higher rate or a longer tenure pushes it later.
Can I get a month-by-month schedule?
The numbers are the same, split into months: each month’s interest is the balance × annual rate ÷ 12 and the rest of the EMI is principal. Your lender provides the official monthly schedule with the loan documents.
Is the EMI here the same as on the EMI calculator?
Yes. Both use the standard reducing-balance formula with the annual rate ÷ 12, and give the same EMI to the rupee for the same inputs.
Related calculators
References
- Brealey RA, Myers SC, Allen F. Principles of Corporate Finance. McGraw-Hill. The present value of an annuity, from which the level-payment loan formula, its schedule and its inverse follow.
- Reserve Bank of India. Key Facts Statement (KFS) for Loans & Advances. RBI/2024-25/18, DOR.STR.REC.13/13.03.00/2024-25, 15 April 2024: lenders must give a KFS with the annual percentage rate, all charges and the repayment schedule for retail and MSME term loans.
- Central-bank inflation targets used as default inflation by currency: Reserve Bank of India (4% CPI, flexible inflation targeting framework); U.S. Federal Reserve (2% PCE); European Central Bank (2%); Bank of England (2% CPI); Bank of Canada (2%); Reserve Bank of Australia (2–3%); Bangko Sentral ng Pilipinas (3% ± 1). Actual inflation often runs above target.