Reading principal and interest in an amortization table

This schedule assumes a fixed nominal annual rate divided by 12 and payments at month end. Each period’s interest is opening balance times monthly rate; the rest of the payment reduces principal.

A principal of 1,200 repaid over 12 months at zero interest requires 100 per month. A zero rate needs this explicit branch rather than division in the usual interest formula. The final payment is capped to the remaining balance and interest.

Actual contracts can include daily accrual, fees, changing payment dates and prepayment conditions. Compare the calculator’s assumptions with the agreement and check actual statements separately.