Amortization Schedule

An amortization schedule is a complete table of periodic loan payments, showing the amount of principal and the amount of interest that comprise each payment until the loan is paid off at the end of its term. While each periodic payment is the same amount early in the schedule, the majority of each payment is interest; later in the schedule, the majority of each payment covers the loan's principal.

The amortization schedule will show both the running total of interest paid over the entire loan term, and the remaining principal balance after each payment.

In the context of real estate and mortgage loans, an amortization schedule will often also show:

The payment number (or payment period)

The payment amount

The amount of each payment that goes towards interest

The amount of each payment that goes towards principal

The remaining balance after each payment

An amortization schedule is important because it shows how each payment affects the overall loan, how much total interest you'll end up paying, and how long it will take to pay off the loan at your current schedule. This can be particularly useful for planning your financial future, determining if it would be beneficial to make extra payments, or understanding how a different loan term might affect your monthly payment and total interest paid.