Loan Amortisation Schedule — where your instalment actually goes
Every field, the formula behind it, and a worked example.
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Help › The calculators › How the loan comes down
A year-by-year table showing how much of each year's instalments is markup and how much actually reduces the loan.
Open this calculator01
When to use it
When the instalment feels large and you want to see why the balance is barely moving. Also before deciding to pay extra.
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Every field, explained
| Loan amount (Rs) | What you are borrowing. |
| Bank markup, yearly (%) | Your bank's quote. |
| Loan length (years) | The table runs one row per year, up to forty. |
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How the answer is worked out
- The monthly instalment is worked out once and stays the same for the whole term.
- Each month, the markup is the balance times the monthly rate; whatever is left of the instalment reduces the balance.
- The table adds up twelve months at a time and shows the markup paid, the loan repaid and the balance left at the end of each year.
A worked example — Rs 1 crore, 20%, 20 years
| Year 1 | Markup Rs 19.8 lakh · loan repaid Rs 0.6 lakh |
| Year 10 | Markup Rs 17.3 lakh · loan repaid Rs 3.1 lakh |
| Year 20 | Markup Rs 1.8 lakh · loan repaid Rs 18.6 lakh |
After a full year of instalments the loan has come down by less than 1%. Almost everything you paid was markup. This is not a trick — it is how every instalment loan behaves — but very few people see it written down before they sign.
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Mistakes people make
- Assuming the balance falls evenly. It does not: it barely moves at first and then falls quickly at the end.
- Using it to plan an early payoff without asking the bank about the early-exit penalty.
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What it does not do
- It assumes a fixed markup for the whole term. Most Pakistani home loans are variable.
- It does not handle extra payments, and it does not show a month-by-month table — only the yearly totals.
- It ignores fees and insurance.
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Questions
- Why is so much of the early instalment markup?
- Does paying extra help?
Because markup is charged on what you still owe, and at the start you owe nearly everything. As the balance falls, the markup share falls with it.
Very much, and most in the early years — every extra rupee then comes straight off the balance that all future markup is charged on.