Loan amortization calculator
Calculate your monthly payment, total interest and the real cost of the loan. French system (fixed payment), works for mortgages, auto loans and personal loans.
Loan details
Monthly payment
USD 932,13
You pay every month for 20 years
Total paid to the bank
USD 223 711
Principal + interest over the entire life of the loan
Total interest
USD 123 711
124% of the original amount
Frequently asked questions
What is loan amortization?
It's the way you repay a loan over time. Each payment is split into two parts: principal (reduces the amount owed) and interest (what the bank earns). On fixed-rate loans, the payments are equal but the mix changes: at the start you pay more interest, at the end more principal.
What is the monthly payment formula?
M = P × [r(1+r)^n] / [(1+r)^n - 1], where M = payment, P = loan amount, r = monthly rate as a decimal (TNA/12 or TEA/12 depending on the case), n = number of payments. This is the French system formula (fixed payment) — the most common one for mortgages and auto loans.
Is it worth making extra payments toward the principal?
Almost always, yes. Every extra peso toward the principal reduces the base on which interest is calculated in all future months. On a 30-year loan, making 1 extra payment a year can save you 5-7 years of payments and tens of thousands in interest.
What is the difference between TNA, TEA and APR?
TNA (Nominal Annual Rate) is the simple rate without compounding. TEA (Effective Annual Rate) does include the effect of compounding (always higher). APR (Annual Percentage Rate) in the US includes additional mandatory costs on top of interest. Always compare using the same metric.
What is an amortization schedule?
It's a month-by-month schedule showing how each payment splits between principal and interest, and how much of the debt remains. It lets you see when you'll finish paying and how much total interest you'll pay. Wälo generates automatic tables for all your active loans.
How amortization works (and why it pays to understand it)
Each monthly payment is split into two parts: principal (reduces your debt) and interest (what the bank earns). On a 20-year loan at 9.5%, in the first years almost everything goes to interest. Only around the middle of the loan do you start reducing principal in earnest.
Pro tip: making even just 1 extra payment a year can save you 5-7 years of payments and tens of thousands in interest. Wälo shows you the exact impact of every extra payment you make.
How to choose the term:
- Short term (10-15 years): higher payment but much lower total interest
- Long term (25-30 years): comfortable payment but you end up paying for the property 2-3 times over
- Rule of thumb: your total payment should not exceed 28% of your gross monthly income
Use this and much more in Wälo
Wälo applies these calculations automatically to your real debts, savings and investments. 14 days of Premium free, no card required.
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