Start low payments and grow them predictably. See flow, interest, and balance at each step. Download clean reports and plan your payment growth confidently.
This calculator computes interest each period using the periodic rate: r = (annual rate / 100) / payments per year.
A standard fixed payment (for comparison) is computed with: PMT = P*r / (1 - (1+r)^(-N)), where P is principal, r is periodic rate, and N is periods.
During the graduated phase, payments rise yearly: Payment_year(y) = P0 * (1 + g)^y, where P0 is starting payment and g is annual increase.
After graduation, the remaining balance is amortized over remaining periods using the same payment formula to find a single level payment.
A graduated payment mortgage starts with a lower initial payment and increases it over time. This helps borrowers with expected income growth. The calculator models a starting payment set as a percentage of the standard payment or as a custom amount, then applies an annual growth rate during the graduation years. For example, a 70% start and 7% annual growth creates higher payments by year five. Use the payment cap to limit growth when you expect bonuses or promotions later.
Each period, interest is computed from the current balance using the periodic rate. Principal equals payment minus interest, plus any extra principal you choose. When the early payment is below the interest due, principal becomes zero and the unpaid interest effectively increases the balance. The schedule highlights when this happens and shows the point where payments begin reducing balance consistently.
During graduation, the payment increases once per year by the growth factor. After the graduation period ends, the calculator recomputes a single level payment that amortizes the remaining balance over the remaining periods. This split shows how early affordability trades off against a higher later payment.
Taxes, insurance, and HOA are optional monthly inputs. The tool converts them to a per‑period amount that matches your payment frequency, then reports both “Payment” and “Total Outflow.” This helps you compare budget impact across monthly, biweekly, and weekly schedules using consistent annual totals. If you enter $300 monthly escrows, the tool allocates roughly $138 per biweekly period.
Review total interest, payoff date, and the balance curve. If negative amortization appears, consider raising the starting payment, shortening graduation years, lowering the growth rate, or adding extra principal. Export the full schedule to CSV for further analysis or share the PDF summary with a lender.
It means the payment starts lower and increases on a defined schedule, typically once per year for a set number of years, before switching to a level payment.
Yes. If your early payment is less than the interest due, unpaid interest can add to the balance. The schedule will show periods where principal is zero and balance rises.
After the graduation phase, the remaining balance is amortized over the remaining periods using the same payment formula, producing one level payment for the rest of the term.
A cap limits how high graduated payments can grow during the graduation phase. It is useful when you want increasing payments but need a maximum budget boundary.
Extra principal reduces the balance faster, lowers total interest, and may shorten the payoff date. The schedule records extra principal separately so you can see its impact clearly.
They do not change principal and interest. They are added as escrows to estimate total cash outflow per period, helping you budget more realistically.
Sample scenarios for quick comparison.
| Scenario | Loan | Rate | Term | Graduation | Increase | Starting Payment |
|---|---|---|---|---|---|---|
| Starter to steady income | $300,000 | 6.50% | 30 years | 5 years | 7% yearly | 70% of standard |
| Short graduation phase | $220,000 | 5.75% | 25 years | 3 years | 6% yearly | 80% of standard |
| Higher growth plan | $400,000 | 6.90% | 30 years | 7 years | 8% yearly | $2,000 custom |
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.