An Amortization Schedule is a calculator or table that indicates towards the capital amount of a loan or mortgage loan and the periodic installments or payments of the loan including the principal loan amount, loan payments and interest rates. With this schedule, you can easily understand the loan payments for your mortgage loan and you can see how much you will pay for the next year and it can even break down the payments and remaining capital of the loan principal for you. This way with the amortization schedule, you can easily evaluate how much you have paid for the mortgage loan, how much is remaining, how many further installments it will take to complete the loan payments and how much money you need to save for the next installments each month.
Here is a good looking Amortization Schedule Template created using OpenOffice Calc,
Types of Amortization Schedules:
- Amortization Analysis:
When a company or even an individual gets loan from a bank or a mortgage loan firm, it is very important for both of them to understand and evaluate different parts and variables of the analysis statement. The amortization analysis schedule helps the companies and individuals to understand how much time it requires for them to pay off their debt and how much each loan payment will cost them along with the evaluation of interest rate for each payment and loan capital amount as well.
- Business Amortization:
When a business or a company gets loan from a bank or mortgage loan firm, the interest rate for the first period of 1 to 3 years is kept very low usually at only 1% where if the company doesn’t pay off the loan capital by the time of expiration of the first period, the interest rate increases to a higher value i.e. 12% or 15%. This type of loan usually has different break points in order to encourage the debtor to pay his debt off quickly in order to avoid the sudden increase in the interest rate. All of these elements and factors are included in the amortization schedule in order to help the analyst to evaluate the payments and possible increase in the interest rates.
- Zoning Regulations:
This is a kind of a different implication of the amortization schedule and although the requirements of the schedule are not the same here but still the calculator serves similar purpose. In the zoning regulations, when a government seizes a property for any purpose, it is important for the owners to understand how much time it will take before they can get back their property and this regulator helps the owners and government agencies to estimate the time for the property to be seized by the government.
Uses and implications of Amortization Schedule:
Amortization schedules are used to help out the people who don’t know much about accounting statements and formulas to calculate and evaluate their mortgage loan payments and remaining payments and time duration for the loan installments. This schedule or calculator can be used for any kind of mortgage loan including personal, commercial, organizational, corporation, short term and long term loan plans.