math

amortization schedule

An amortization schedule is a table showing each payment on a fully amortized loan, broken into the portion applied to interest and the portion applied to principal, along with the remaining balance after each payment. With a fixed-rate loan the payment stays the same, but early payments are mostly interest; as the balance falls, more of each payment goes to principal. Interest for each month is the balance times the annual rate divided by 12.

Exam tip
Monthly interest = balance x annual rate / 12; principal paid = payment minus interest. Exams often ask for the balance after the first payment.
Example
On a $200,000 loan at 6% with a $1,199 payment, month one interest is $1,000, principal is $199, and the new balance is $199,801.

Related terms & state variants

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Last verified: 2026-10-23