What is the purpose of an amortization schedule?

An amortization schedule serves as a timetable outlining the payments required to pay off a mortgage over time, detailing each payment amount, the portion that goes toward interest, the portion that goes toward the principal balance, and the remaining balance after each payment. This schedule is crucial for borrowers because it provides a clear roadmap of how the loan will be paid down over its term, enabling them to understand how much they will pay in total and how their equity in the property will increase over time.

The other options do not align with the purpose of an amortization schedule. A loan application summary would detail the information provided during the loan application process, while an overview of interest rates available refers to different loan products or mortgage options. A record of all future late payments is unrelated, as an amortization schedule is not meant to track late payments but rather to outline the agreed-upon payment plan.