Please Note: This article is written for users of the following Microsoft Excel versions: 97, 2000, 2002, and 2003. If you are using a later version (Excel 2007 or later), this tip may not work for you. For a version of this tip written specifically for later versions of Excel, click here: Creating an Amortization Schedule.
by Allen Wyatt
(last updated June 29, 2019)
Mary would like to use Excel to create an amortization schedule for her home mortgage. Problem is, she doesn't know enough about finance to know which of the financial worksheet functions she should use to do the calculations.
It actually is fairly easy to come up with the right calculations. At its simplest, a mortgage payment consists of two parts: principle and interest. Given some basic information such as how much you are borrowing (your principal), what your interest rate is, and how many monthly payments you need to make, you can then come up with your amortization schedule. Try this out:
Figure 1. A simple amortization schedule.
Remember that I said that this creates a simple amortization schedule. It doesn't take into account varying interest rates, refinancing, non-monthly payments, additional payments, escrow amounts, or any number of other variables. In such instances you would be better to look for a ready-made amortization template. There are any number of them available online, including these from Microsoft:
You can also find a very good explanation of amortization schedules at this page:
ExcelTips is your source for cost-effective Microsoft Excel training. This tip (11627) applies to Microsoft Excel 97, 2000, 2002, and 2003. You can find a version of this tip for the ribbon interface of Excel (Excel 2007 and later) here: Creating an Amortization Schedule.
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