A mortgage is a significant financial commitment, and understanding how your payments are allocated over the life of the loan is crucial for effective financial planning. A mortgage payment schedule, often called an amortization schedule, breaks down each monthly payment into its principal and interest components, and shows the remaining loan balance after each payment.
How Mortgage Payments Work
Your fixed monthly mortgage payment typically includes:
Principal: The portion of your payment that reduces the actual amount you borrowed.
Interest: The cost of borrowing the money.
Escrow (sometimes): Funds held by the lender to pay property taxes and homeowner's insurance. This calculator focuses solely on principal and interest payments.
In the early years of a mortgage, a larger portion of your payment goes towards interest. As the loan matures, more of your payment is applied to the principal, accelerating the equity build-up in your home.
The Math Behind the Schedule
The calculation for a fixed-rate mortgage payment is based on the following formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Your total monthly mortgage payment (principal and interest)
P = The principal loan amount
i = Your monthly interest rate (annual rate divided by 12)
n = The total number of payments over the loan's lifetime (loan term in years multiplied by 12)
Generating Your Payment Schedule
Once the monthly payment (M) is calculated, the amortization schedule is generated iteratively for each payment period:
Calculate Monthly Interest: For the current month, multiply the current outstanding loan balance by the monthly interest rate (i).
Calculate Principal Payment: Subtract the monthly interest from the total monthly payment (M). This is the amount that reduces the loan balance.
Update Loan Balance: Subtract the principal payment from the previous month's ending balance.
Repeat: Continue this process for each payment period until the loan balance reaches zero.
Key Takeaways from Your Schedule
Amortization Pattern: Visually see how interest paid decreases and principal paid increases over time.
Equity Building: Understand how quickly you are building equity in your home.
Total Cost Analysis: Accurately calculate the total interest paid over the entire loan term.
Financial Planning: Helps in budgeting and understanding the long-term financial commitment.
This calculator provides a clear and detailed breakdown, empowering you to make informed decisions about your mortgage and overall financial strategy.
function calculateMortgageSchedule() {
var loanAmount = parseFloat(document.getElementById("loanAmount").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var loanTermYears = parseFloat(document.getElementById("loanTermYears").value);
// Basic validation
if (isNaN(loanAmount) || loanAmount <= 0 ||
isNaN(annualInterestRate) || annualInterestRate <= 0 ||
isNaN(loanTermYears) || loanTermYears <= 0) {
alert("Please enter valid positive numbers for all fields.");
return;
}
var monthlyInterestRate = annualInterestRate / 100 / 12;
var numberOfPayments = loanTermYears * 12;
// Calculate monthly payment (M) using the formula M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
var monthlyPayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
var tableHTML = "
";
tableHTML += "
Payment #
Payment Date
Starting Balance
Payment
Interest Paid
Principal Paid
Ending Balance
";
var currentBalance = loanAmount;
var totalInterestPaid = 0;
var totalPrincipalPaid = 0;
var totalPaymentsMade = 0;
for (var i = 1; i <= numberOfPayments; i++) {
var interestPayment = currentBalance * monthlyInterestRate;
var principalPayment = monthlyPayment – interestPayment;
// Adjust for the last payment to ensure balance is exactly zero
if (i === numberOfPayments) {
principalPayment = currentBalance;
monthlyPayment = interestPayment + principalPayment; // Recalculate final payment amount if needed
}
currentBalance -= principalPayment;
totalInterestPaid += interestPayment;
totalPrincipalPaid += principalPayment;
totalPaymentsMade += monthlyPayment;
// Prevent negative balances due to floating point inaccuracies
if (currentBalance < 0) {
currentBalance = 0;
}
// Format date (simple representation)
var paymentDate = new Date();
paymentDate.setMonth(paymentDate.getMonth() + i -1); // This might not be perfectly accurate for dates spanning years/months, but serves demonstration
var month = String(paymentDate.getMonth() + 1).padStart(2, '0'); // Months are 0-indexed
var year = paymentDate.getFullYear();
var formattedDate = `${year}-${month}`; // Simple Year-Month format
tableHTML += "