1. What is the Mortgage Amortization Calculator?

The Mortgage Amortization Calculator by Payment Amount determines how many months it will take to pay off a loan given a fixed monthly payment amount, loan principal, and interest rate.

2. How Does the Calculator Work?

The calculator uses the mortgage amortization formula:

Where:

• \( n \) — Number of months to repay loan
• \( PMT \) — Monthly payment amount (USD)
• \( PV \) — Loan principal amount (USD)
• \( r \) — Monthly interest rate (decimal)

Explanation: The formula calculates the time required to pay off a loan when the payment amount is known, accounting for compound interest.

3. Importance of Loan Term Calculation

Details: Knowing the loan term helps borrowers understand their long-term financial commitment and compare different loan options.

4. Using the Calculator

Tips: Enter monthly payment in USD, loan amount in USD, and monthly interest rate as a decimal (e.g., 0.005 for 0.5%). All values must be positive.

5. Frequently Asked Questions (FAQ)

Q1: What happens if my payment is too low?
A: If the payment doesn't cover the interest (PMT ≤ PV×r), the loan can never be repaid and the calculator will show an error.

Q2: How does extra payment affect the term?
A: Extra payments reduce principal faster, shortening the loan term. This calculator assumes fixed regular payments.

Q3: Is this for fixed-rate mortgages only?
A: Yes, this calculation assumes a fixed interest rate and fixed payment amount throughout the loan term.

Q4: How do I convert APR to monthly rate?
A: Divide annual percentage rate (APR) by 12 (for months) and convert from percentage to decimal (e.g., 6% APR = 0.06/12 = 0.005 monthly).

Q5: Why does the result sometimes show a fraction?
A: The calculation may result in partial months, but we round to whole months since payments are typically made in whole months.