See your full loan amortization schedule, total interest, and how extra payments shorten your payoff time.
Rates as of Q2 2025 (example)
| Period | Date | Payment | Principal | Interest | Balance |
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An amortization calculator generates a complete schedule showing how each payment on a loan is split between interest and principal, how your balance declines over time, and how much total interest you'll pay over the life of the loan. It also shows how an extra monthly payment can shorten your payoff time and reduce total interest — useful for any amortizing loan, including mortgages, auto loans, and personal loans.
Each monthly payment is calculated to be the same amount throughout the loan (assuming no extra payments), but the split between interest and principal changes every month: early payments are mostly interest (since the balance is highest), while later payments are mostly principal (since the balance has shrunk). An extra payment goes entirely toward reducing the principal, which reduces the interest charged on all future payments — compounding the benefit over time.
Formula: Monthly Payment = Loan Amount × [r(1+r)n] ÷ [(1+r)n − 1], where r is the monthly interest rate (Annual Rate ÷ 12 ÷ 100) and n is the number of monthly payments (Amortization Period × 12). Each month: Interest = Balance × r; Principal Paid = Payment + Extra Payment − Interest; New Balance = Balance − Principal Paid.
Example: A CA$400,000 loan at a 5.5% interest rate (example rate — enter your actual rate) over a 25-year amortization period gives a monthly payment of roughly CA$2,456, with total interest of about CA$336,905 over the full term. Adding an extra CA$200/month would pay off the same loan in roughly 21.4 years instead of 25, reducing total interest to about CA$280,654 — a saving of roughly CA$56,251. (Note: all figures in this example are for illustration purposes only and do not represent a loan offer.)
Amortization schedules apply to most fixed-payment loans in Canada, including mortgages (where the amortization period is commonly 25-30 years, separate from the shorter mortgage term during which your rate is fixed — see our Mortgage Calculator for more detail), auto loans, and personal loans. Many Canadian mortgages include "prepayment privileges" that allow you to make extra payments — often up to a certain percentage of the original principal per year, or the ability to increase your regular payment by a certain percentage — without triggering a prepayment penalty. Using these privileges, as illustrated by the "extra monthly payment" feature here, can meaningfully reduce the total interest paid over the life of a mortgage. However, check your specific loan agreement, as prepayment privileges, limits, and penalties vary by lender and product, and exceeding allowed prepayment limits can trigger charges, especially on fixed-rate mortgages.
Interest is calculated on your current outstanding balance, which is highest at the start of the loan. As you pay down principal over time, the balance shrinks, so the interest portion of each payment decreases and the principal portion increases - even though the total payment stays the same (assuming no extra payments or rate changes).
The savings can be substantial, especially early in a long-term loan, because every dollar of extra principal paid reduces the interest charged on that dollar for the rest of the loan term. For example, an extra CA\$200/month on a CA\$400,000, 25-year loan at 5.5% could save tens of thousands of dollars in interest and shorten the amortization period by several years - try entering different extra payment amounts to see the effect on your specific loan.
Prepayment privileges are features of many Canadian mortgages that allow you to pay down your mortgage faster without penalty - commonly including the ability to make lump-sum payments (often up to a percentage of the original principal per year) and/or increase your regular payment amount (often up to a percentage increase) without it being treated as an early repayment subject to a penalty. Limits and rules vary by lender and mortgage product.
Yes. The amortization formula used here applies to any fixed-payment, fixed-rate loan, including auto loans, personal loans, and student loans, as well as mortgages. Just enter the relevant loan amount, interest rate, and term for your specific loan.
No. This calculator assumes a constant interest rate for the entire amortization period entered. For mortgages, your actual rate typically only applies for your mortgage term (often 5 years) and may change at renewal - the schedule beyond your term length is illustrative based on the rate you entered, not a guarantee of your future rate.
The monthly view shows the breakdown of every individual payment - the interest, principal, and remaining balance for each month. The yearly view summarizes the same information by calendar year, totaling the interest and principal paid and showing the balance at year-end - useful for getting a higher-level picture of how your loan progresses over time without scrolling through every monthly entry.
Disclaimer: The information, rates, and figures provided on this page are for educational and illustrative purposes only and do not constitute a loan offer or financial advice. The default interest rate is a sample value and does not reflect rates currently available from any specific lender. This calculator assumes a constant interest rate for the full amortization period and does not account for rate changes at mortgage renewal, prepayment penalties, or fees. Always check your specific loan agreement and consult a qualified financial adviser or mortgage broker before making borrowing decisions.