Generate a complete loan amortization schedule showing how each EMI is split between principal and interest.
| Monthly EMI | — |
| Total Interest Paid | — |
| Total Amount Paid | — |
Amortization is the process of paying off a loan through regular payments over time. Each payment covers both interest for the current period and principal reduction. Early payments are mostly interest; later payments are mostly principal.
Q: Why do I pay more interest in early months?
A: Interest is charged on the outstanding balance. Since the balance is highest at the start, interest is highest too. As you pay down principal, interest charges decrease.
Q: How does prepayment reduce loan cost?
A: Prepayments reduce the outstanding principal, which directly reduces future interest charges and can shorten the loan tenure significantly.
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