Last updated: March 2026 · Standard US mortgage amortization formula
When you take out a 30-year fixed mortgage, your monthly payment never changes, but what that payment is applied to changes drastically every single month. An amortization schedule reveals exactly how much of your hard-earned money is paying down the home (Principal) versus going to the bank (Interest).
Because interest is calculated based on your outstanding loan balance, your highest interest payments occur at the very beginning of the loan.
When you make an "Extra Principal" payment, you instantly jump forward in the amortization schedule. Every $100 you pay early directly reduces the outstanding balance, meaning the bank can never charge you compound interest on that $100 again.
By looking at our amortization chart, you can clearly see the impact of adding just $200 a month in extra payments. On a $400,000 mortgage at 7%, paying an extra $200 a month will shave roughly 6 years off the loan and save you tens of thousands of dollars in lifetime interest.
Only under three circumstances: 1) You have an Adjustable-Rate Mortgage (ARM) where the rate resets, 2) You "recast" your loan by making a massive lump-sum payment and having the lender recalculate the payment, or 3) You refinance into an entirely new loan.
Yes. By dividing your monthly payment in half and paying it every two weeks, you end up making 26 half-payments a year (which equals 13 full payments). That one "hidden" extra payment per year dramatically speeds up your amortization schedule. Try toggling the "Bi-Weekly" switch in our calculator to see the math.
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