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Loan Summary
Here's a complete breakdown of your loan over the full term, including total interest paid and your equity milestones.
Yearly Amortization Schedule
See exactly how your loan pays down year by year. Notice how early payments are mostly interest, then gradually shift toward principal.
| Year | Principal | Interest | Total Paid | Balance |
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How Mortgage Payments Work
The Math Behind Your Payment
Mortgage payments use compound interest amortization. The formula is: M = P × [r(1+r)^n] / [(1+r)^n – 1], where P is principal, r is monthly interest rate, and n is number of payments. Early payments are mostly interest; over time, the balance shifts toward principal as your balance decreases.
Why Principal Grows Over Time
Each payment charges interest only on the remaining balance. As you pay down principal, interest charges decrease slightly, so more of each fixed payment goes toward principal. This accelerating principal paydown is called "negative amortization in reverse" — a powerful wealth-building feature of fixed-rate mortgages.
The Power of Extra Payments
Making even one extra payment per year on a 30-year mortgage can reduce the loan term by about 4–5 years and save tens of thousands in interest. Extra payments go directly to principal, which reduces future interest charges. Our calculator shows you the baseline — consider what extra payments could do.
Principal vs Total Cost
On a $280,000 loan at 6.82% for 30 years, you'll pay approximately $423,000 in interest alone — totaling over $700,000 repaid for a $280,000 loan. This is why refinancing to a lower rate or making extra payments can save dramatic amounts. The interest cost is highest in the first decade.