Mortgage Amortization Calculator
See exactly how each mortgage payment is split between principal and interest. Understand your full payment schedule and discover how extra payments can save you thousands.
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What is Mortgage Amortization?
Mortgage amortization is the process of paying off your home loan through regular monthly payments over a set period (typically 15 or 30 years). Each payment you make includes two components:
- Principal: The amount that reduces your loan balance
- Interest: The cost of borrowing the money
Here's what makes amortization unique: early in your loan, most of your payment goes toward interest. As time passes, more of each payment goes toward principal. This happens because interest is calculated on your remaining balance, which decreases as you pay down the loan.
How to Read Your Amortization Schedule
An amortization schedule is a complete table showing every payment over the life of your loan. Here's what each column means:
Payment Number
Which month you're in (1-360 for a 30-year loan)
Principal Paid
Amount reducing your loan balance that month
Interest Paid
Cost of borrowing for that month
Remaining Balance
How much you still owe after that payment
5 Ways to Pay Off Your Mortgage Faster
1. Make Extra Principal Payments
Even an extra $100/month toward principal can shave years off your loan and save tens of thousands in interest. Use our calculator to see the impact.
2. Make Biweekly Payments
Pay half your mortgage every two weeks instead of once a month. You'll make 26 half-payments (13 full payments) per year instead of 12, paying down principal faster.
3. Refinance to a Shorter Term
Switching from a 30-year to a 15-year mortgage increases your monthly payment but dramatically reduces total interest paid. Contact us at (718) 812-7798 to explore options.
4. Apply Windfalls to Principal
Tax refunds, bonuses, or inheritance? Applying lump sums directly to principal can significantly accelerate payoff.
5. Round Up Your Payments
If your payment is $1,847, round up to $2,000. The extra $153/month goes straight to principal and adds up quickly over time.
Bergen County Mortgage Amortization Example
Let's look at a real Bergen County scenario. The median home price in Ridgewood, NJ is approximately $850,000. With a 20% down payment ($170,000), you'd finance $680,000.
Loan Amount
$680,000
Interest Rate
6.5%
Monthly Payment (P&I)
$4,297
Total Interest Paid
$866,920
First Payment Breakdown: $4,297 total = $3,667 interest + $630 principal
Final Payment Breakdown: $4,297 total = $23 interest + $4,274 principal
Use our calculator above to see your personalized amortization schedule for your Bergen County home purchase.
Frequently Asked Questions
What is mortgage amortization?
Mortgage amortization is the process of paying off your home loan through scheduled monthly payments over time. Each payment includes both principal (the loan amount) and interest, with the proportion shifting over the life of the loan.
How does an amortization schedule work?
An amortization schedule shows every payment you will make over the life of your loan. Early payments are mostly interest, while later payments are mostly principal. This happens because interest is calculated on the remaining balance, which decreases over time.
Why do I pay more interest at the beginning of my mortgage?
You pay more interest early because interest is calculated on your remaining loan balance. When the balance is highest (at the start), the interest portion is largest. As you pay down principal, less interest accrues each month.
How can I pay off my mortgage faster?
You can pay off your mortgage faster by making extra principal payments, refinancing to a shorter loan term (like 15 years instead of 30), or making biweekly payments instead of monthly. Always verify with your lender that extra payments go toward principal.
What is the difference between principal and interest?
Principal is the actual loan amount you borrowed to buy your home. Interest is the cost of borrowing that money, expressed as a percentage rate. Your monthly payment includes both, plus potentially taxes and insurance (PITI).
Does an amortization calculator include taxes and insurance?
Most amortization calculators focus on principal and interest only. Property taxes, homeowners insurance, and PMI are typically shown separately. Your total monthly payment (PITI) includes all these components.
Ready to Get Your Personalized Amortization Schedule?
Contact Jimmy Joseph MBA for a detailed mortgage analysis tailored to your Bergen County home purchase.
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