Use the Brett Weisel Amortization Calculator to determine your monthly mortgage payments based on loan details such as the amount, interest rate, and term. This tool provides both a basic and advanced mode for your convenience.

## Amortization Calculation Formula

The amortization formula used to calculate monthly payments is:

Monthly Payment = Principal * (Monthly Interest Rate / (1 - (1 + Monthly Interest Rate)^-Number of Payments))

Variables:

- Monthly Payment is the amount paid each month ($)
- Principal is the total loan amount ($)
- Monthly Interest Rate is the annual interest rate divided by 12 (%)
- Number of Payments is the total number of monthly payments (years x 12)

To calculate the monthly payment, multiply the principal by the monthly interest rate and divide by 1 minus (1 plus the monthly interest rate) raised to the power of negative number of payments.

## What is Amortization?

Amortization refers to the process of spreading out a loan into a series of fixed payments over time. Each payment covers both interest and principal, gradually reducing the outstanding balance of the loan until it is fully repaid by the end of the term.

## How to Calculate Monthly Payments?

Follow these steps to calculate your monthly payments:

- Determine the total loan amount (principal), the annual interest rate, and the loan term (in years).
- Convert the annual interest rate to a monthly interest rate by dividing by 12.
- Calculate the total number of payments by multiplying the number of years by 12.
- Apply the amortization formula to find the monthly payment amount.
- Use the calculator to check your results and ensure accuracy.

**Example Problem:**

Try using the following example to test your understanding:

Loan Amount = $200,000

Annual Interest Rate = 4%

Loan Term = 30 Years

## FAQ

**1. What is amortization?**

Amortization is the gradual repayment of a loan through regular payments over a set period, which includes both interest and principal amounts.

**2. How is the monthly payment calculated?**

The monthly payment is calculated using the loan amount, interest rate, and term, according to the amortization formula. It ensures that the loan is fully repaid by the end of the term.

**3. Can I use this calculator for different loan types?**

Yes, the calculator can be used for various types of loans by adjusting the inputs for the principal, interest rate, and term accordingly.

**4. What if I make additional payments?**

Making additional payments can reduce the overall loan balance faster, resulting in lower total interest paid and a shorter loan term.

**5. Is the calculator accurate?**

The calculator provides an estimate based on the inputs provided. For precise details, refer to your loan documents or consult a financial advisor.