Methodology
Every number on this site comes from one thing: the standard amortization schedule your lender uses. Below is the full math, worked on a real example, with nothing hidden.
1. Where your monthly payment comes from
For a loan of principal P, monthly rate r = APR ÷ 12, and term n months, the level payment that exactly retires the loan is:
M = P · r / (1 − (1 + r)−n)
That's the standard level-payment annuity formula — the same one in every lender's disclosure. If your rate is 0%, the payment is simply P ÷ n.
$30,000 student loan at 5.8% APR, 10-year term (120 payments).
r = 5.8% ÷ 12 = 0.4833% per month → M = $330.06/month.
Over 120 payments you'd remit $39,607 — $9,607 of it interest, nearly a third of what you borrowed.
2. Reading an amortization schedule
Each month, interest is charged on the remaining balance first; whatever's left of your payment reduces principal. The catch most borrowers feel but never see: early payments are interest-heavy. In month 1 of our example, $145.00 of your $330.06 payment — 44 cents of every dollar — goes to interest, not your debt.
| Month | Payment | Interest | Principal | Balance left |
|---|---|---|---|---|
| 1 | $330.06 | $145.00 | $185.06 | $29,815 |
| 2 | $330.06 | $144.11 | $185.95 | $29,629 |
| 3 | $330.06 | $143.21 | $186.85 | $29,442 |
| 4 | $330.06 | $142.30 | $187.75 | $29,254 |
| 5 | $330.06 | $141.40 | $188.66 | $29,066 |
| 6 | $330.06 | $140.48 | $189.57 | $28,876 |
| … | … | … | … | … |
| 119 | $330.06 | $3.17 | $326.89 | $328 |
| 120 | $330.06 | $1.59 | $328.47 | $0 |
By the final payment the roles have flipped: $3.17 of interest versus $326.89 of principal. The schedule crosses over around payment 82 — that's why extra payments made early do so much more work.
3. What extra payments actually buy
Extra payments go straight to principal (we apply them the same way servicers do — as additional principal reduction that month, with one-time lump sums applied on the month you pick). On the example loan:
One extra hundred a month — a 30% larger payment — cuts nearly three years off the loan and saves $2,928. Read the full extra student loan payments guide, or run your own numbers with the payoff calculator, including lump sums.
4. Biweekly payments, honestly explained
Biweekly mode models 26 half-payments a year instead of 12 full ones — the equivalent of 13 monthly payments annually. The 13th payment is applied entirely to principal. It's not magic; it's one extra payment a year, spread out so it's barely noticeable. On the example loan, biweekly pays off in roughly 108 months and saves about $8,567 in interest — solid, but worth knowing it's a convenience-cadence strategy, not an optimization.
5. Multiple loans: snowball vs. avalanche
When you add several loans, each keeps its minimum so nothing goes delinquent, and your extra amount targets one loan at a time. When a loan is paid off, its minimum rolls into your extra pool — that's the mechanism both strategies share. Only the targeting order differs:
- Debt avalanche targets the highest rate first — mathematically the cheapest path.
- Debt snowball targets the smallest balance first — fastest first win, slightly more interest.
| Example | Avalanche | Snowball | Gap |
|---|---|---|---|
| Loan A: $18,000 @ 6.8% + Loan B: $12,000 @ 4.5%, extra $100/mo | 85 mo, $6,490 interest | 87 mo, $7,191 interest | $701 / 2 mo |
Avalanche kills the 6.8% loan first and finishes 2 months sooner for $701 less. Snowball clears the $12,000 loan at month 60 — a whole loan gone two years before avalanche's first payoff. The honest takeaway: run both in the multi-loan calculator. If the gap is small, take the motivation; if it's large, take the math. More detail in snowball vs. avalanche.
6. Why our numbers may differ slightly from your servicer
- Servicers accrue interest daily; we use monthly periods. On a 60-month loan the difference is typically under $5.
- Payment dates, leap months, and rounding conventions vary by lender.
- Precomputed-interest loans (rare) don't follow this schedule — check your contract.
Every figure on this page is generated by the same engine that powers the calculators — the formulas and edge cases are pinned by tests in src/lib/loan.test.ts of our open build. If a number ever looks wrong to you, tell us via the about page; we fix math in public.
Educational tool, not financial advice. Your servicer's official amortization schedule governs your actual loan.