When you make payments early in a loan, more of the payment goes towards interest, but this changes over time, where a larger portion will pay down the principal as your loan term progresses. Even better, an amortization schedule will tell you how much of your payment goes towards the principal of the loan the amount that goes towards the interest. When you “amortize” a loan, you schedule out the payments until the entire balance - the principal plus interest - equals zero. You can certainly make one of these schedules on your own, but this isn’t necessary since there are a ton of free loan amortization schedules for Excel that you can download and use. How you track these payments and fit them into your overall budget can be a challenge, unless you have a process and the right calculation to follow.įortunately, an amortization schedule can provide you with the exact amount due over the life of your loan and Excel can create this through various formulas. If you’ve taken out a loan or plan to do so in the future, you are committing yourself to making certain payments to the lender.
An Excel loan amortization schedule template can help you plan your loan repayment.
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