Free tool · US and Canada
Loan payment and amortization calculator
The payment on a business loan, equipment loan or mortgage, the total interest, and a schedule of every payment. Add extra payments to see what you save. Runs in your browser; nothing is saved.
The loan
For a mortgage in Canada, use the amortization period (often 25 years), not the 5-year term.
The first payment is one period later.
Payments
Regular payment
$1,013.82
Number of payments
60
Rate per payment
Annual rate ÷ payments a year
0.6667%
Total interest
$10,829.18
Total paid
$60,829.18
Last payment
Nov 1, 2031
A fixed-rate loan with equal payments. Fees, insurance and variable rates are not included; your lender's figures may differ by a few cents from rounding. Works in any currency.
Amortization schedule by year
| Year | Paid | Interest | Principal | Balance |
|---|---|---|---|---|
| 2026 | $1,013.82 | $333.33 | $680.49 | $49,319.51 |
| 2027 | $12,165.84 | $3,637.35 | $8,528.49 | $40,791.02 |
| 2028 | $12,165.84 | $2,929.50 | $9,236.34 | $31,554.68 |
| 2029 | $12,165.84 | $2,162.88 | $10,002.96 | $21,551.72 |
| 2030 | $12,165.84 | $1,332.65 | $10,833.19 | $10,718.53 |
| 2031 | $11,152.00 | $433.47 | $10,718.53 | $0.00 |
How the payment and schedule are worked out
- Rate per payment (r) = annual rate ÷ payments a year. For a Canadian fixed-rate mortgage: r = (1 + annual rate ÷ 2)^(2 ÷ payments a year) − 1.
- Number of payments (n) = years × payments a year.
- Payment = P × r ÷ (1 − (1 + r)^−n), rounded to the cent.
- Each line of the schedule: interest = balance × r; principal = payment − interest; new balance = balance − principal. The last payment is adjusted so the balance ends at exactly zero.
- Extra payments are added to principal every period until the loan is paid off.
Worked example
A landscaping company borrows $50,000 for a truck at 8% over 5 years, paid monthly. The payment is $1,013.82. The first month's interest is $50,000 × 0.08 ÷ 12 = $333.33, so $680.49 reduces the balance to $49,319.51. Over the 60 payments the company pays $10,829.18 of interest. Adding $200 a month clears the loan 11 months early and saves about $2,179.
Before you sign
- Compare the total cost, not just the payment. A longer term lowers the payment and raises the interest.
- Ask about fees (origination, documentation, early repayment). They are not in this calculation, and they raise the true cost.
- Check the payment fits your cash flow. The cash runway calculator shows what a new payment does to your months of cash.
- Know what falls due this year. The principal due in the next 12 months is a current liability; it counts in the working capital calculator.
- For equipment, think about depreciation too: the depreciation calculator shows the tax side.
Sources
As of October 25, 2026.
Questions
How is a loan payment calculated?
For a fixed-rate loan with equal payments: payment = P × r ÷ (1 − (1 + r)^−n), where P is the amount borrowed, r the interest rate per payment and n the number of payments. $50,000 at 8% a year over 5 years of monthly payments: r = 0.08 ÷ 12, n = 60, so the payment is $1,013.82.
What is an amortization schedule?
A table of every payment showing how much goes to interest, how much reduces the principal, and the balance left. Early payments are mostly interest because the balance is high; later ones are mostly principal. On the $50,000 example the first payment is $333.33 of interest and $680.49 of principal.
How much do extra payments save?
Every extra dollar goes straight to principal, so it stops interest from building on it for the rest of the loan. Adding $200 a month to the $50,000, 8%, 5-year loan pays it off in 49 months instead of 60 and saves about $2,179 of interest. Check first that your loan has no prepayment penalty.
Why is a Canadian mortgage payment different?
Canadian fixed-rate mortgages state interest calculated half-yearly (the Interest Act requires the rate to be shown calculated yearly or half-yearly, not in advance), so the rate per monthly payment is a little lower than the annual rate ÷ 12. On $400,000 at 5% over 25 years, the payment is $2,326.42 with semi-annual compounding against $2,338.36 with monthly compounding. Tick the Canadian mortgage box to use it.
Do biweekly payments pay a loan off faster?
Biweekly payments sized as the monthly payment ÷ 2 do, because 26 half-payments equal 13 monthly payments a year. Payments the calculator sizes for a biweekly schedule (the exact amount to repay over the term) do not by themselves; they only spread the same cost more evenly. To pay off faster, add an extra amount.
How do I record loan payments in my books?
Split each payment: the interest part is an expense, the principal part reduces the loan liability on the balance sheet. The amortization schedule gives you both figures for every payment. Our guide on how to record a business loan walks through the entries.
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Related
- All free tools
- What is amortization?
- How to record a business loan
- Fixed assets and depreciation basics
- Break-even calculator
- Try AcboBooks free for 15 days
An estimate for a fixed-rate loan, not financial advice. Your lender's figures are the ones that count.
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