Use your parents, your relatives, or your own loan (either mortgage or auto loan) as an example to work out monthly payment schedules (For each month, list the total monthly payment, interest payment, and payment toward principal). List: 1. Total loan amount (If you want to protect privacy, you may multiply this number by 2, or 3, or 0.5) for first month and beginning balances for other months. 2. The starting month of the loan and number of years of amortization left. (monthly payment) 3. APR of the loan (normally the Rate quoted by the loan broker) 4. Monthly payment 5. Interest payment each month. 6. Payment toward principal. Check if the total interest payment last year (2016) you calculated is same as shown on form 1098 (Optional) . Put everything in Excel spreadsheet and use the spreadsheet formula. Please do not use any built-in formula from your broker or online mortgage resource if you are not able to fully explain the built-in formula.