Loan Calculator
Monthly payment, total interest, and payoff.
Use this calculator when you need to understand the true cost of borrowing — not just the monthly payment. Enter the loan amount, annual interest rate, and repayment term to see your monthly payment, total interest paid, and total repayment amount. This is most useful when comparing loan offers with different terms: deciding whether a 3-year or 5-year term is better on the same principal, or checking whether a loan is affordable before accepting an offer. The calculation uses standard amortization, where each monthly payment covers accrued interest first and then reduces the principal. Early in the loan most of each payment is interest; this balance shifts gradually over time. An amortization schedule shows the full breakdown month by month. This calculator uses a fixed interest rate and does not include origination fees, insurance, or prepayment penalties — use the APR figure from your lender for the most accurate comparison between competing offers.
See also: Loan Repayment Methods: Equal Payment vs. Equal Principal, Mortgage Total Cost: Beyond Principal and Interest, Early Repayment Effects: Save Interest and Shorten Term, Variable Rate Risks: What Changes When Rates Move · Mortgage Calculator, Compound Interest, Discount Calculator.
When this calculator helps most
Ideal for fixed-rate, fully amortizing installment loans where you want a monthly payment and total interest cost — car loans, personal loans, and fixed student-loan scenarios before fees.
What each input means
- Loan amount (principal) — Amount borrowed before fees; the basis for interest accrual. (your currency)
- Annual interest rate — Nominal yearly rate used to derive the monthly periodic rate r = annual ÷ 12. (% per year)
- Loan term — Total repayment period; monthly n = years × 12. (years)
Input mistakes to avoid
- •Principal should match amount financed after down payment, not MSRP of a vehicle alone.
- •Enter annual rate as 7.5 for 7.5%, not 0.075, unless the UI specifies decimals.
- •Term in years × 12 must equal the number of payments for monthly schedules.
Loan Calculator
Same monthly payment throughout the loan term
Formula
Examples
$10,000 Personal Loan at 8% for 3 Years
Typical personal loan for home improvement or an emergency expense.
→ Monthly: $313.36 | Total interest: $1,281 | Total paid: $11,281
$25,000 Car Loan at 6% for 5 Years
Standard auto loan for a mid-range vehicle.
→ Monthly: $483.32 | Total interest: $3,999 | Total paid: $28,999
$50,000 Student Loan at 5.5% for 10 Years
Standard 10-year student loan repayment.
→ Monthly: $542.36 | Total interest: $15,083 | Total paid: $65,083
Comparing 3-Year vs 5-Year — $20,000 at 7%
Shows how term length affects monthly payment versus total interest cost.
→ 3-year: $618/mo, $2,244 interest | 5-year: $396/mo, $3,760 interest — saving $222/month costs $1,516 more overall
$5,000 Short-Term Loan at 15% for 2 Years
Illustrates the relatively high cost of short-term high-rate borrowing.
→ Monthly: $242.43 | Total interest: $818 | Total paid: $5,818
Compare 15‑year vs 30‑year on $250,000 at 6.5%
Shorter term has higher monthly payments but much lower total interest.
→ 15‑yr monthly ≈ $2,179 | 30‑yr monthly ≈ $1,580 | Total interest 15‑yr ≈ $142k, 30‑yr ≈ $319k
Extra $100/month on $120,000 for 20 years (7%)
See how small extra principal payments reduce interest and term.
→ Base monthly ≈ $930.03 | With +$100 extra, interest saves ≈ $18k and pays off ~2.4 years earlier
How to read your results
- →Monthly payment is chosen so the loan fully amortizes by the final month at the stated rate.
- →Total interest = (monthly payment × number of payments) − principal — compare this across lenders and terms.
- →Early payments are interest-heavy; extra principal payments reduce future interest immediately.
- →If two loans have similar monthly payments but different APRs, prefer the lower APR (fees included).
What this result means
The payment is the constant amount that retires the loan at the stated nominal rate on a standard monthly schedule — a benchmark for comparison, subject to fees and contract quirks.
Common Pitfalls
- ⚠️Comparing loans by monthly payment only — always check total interest and APR.
- ⚠️Ignoring fees and prepayment penalties — they can erase apparent savings.
- ⚠️Using the wrong compounding convention when comparing rates.
- ⚠️Not stress‑testing a +1% rate scenario before committing.
Tips
- ✓Always compare APR — not just the stated interest rate — when evaluating competing loan offers. Fees make a meaningful difference.
- ✓Calculate total repayment cost before accepting a loan, not just the monthly payment. The monthly figure alone can be misleading.
- ✓Adding even a small amount to each monthly payment can save significant interest. Run the numbers before deciding it's not worth it.
- ✓A lower interest rate almost always matters more than the loan term — reducing the rate by 1% on a $30,000 loan saves over $800 in interest.
- ✓If your lender charges a prepayment penalty, factor that into any plan to pay off early.
- ✓When comparing offers, standardize term/compounding to avoid apples‑to‑oranges APR comparisons.
How to check your results
- ✓Use PMT in Excel/Google Sheets with the same principal, rate/12, and nper.
- ✓Total interest = payment × n − principal; reconcile with one extra hand calculation.
Warnings & Limitations
- ⚠️Estimates exclude lender fees, insurance, and taxes — check APR and your contract.
- ⚠️Some loans charge prepayment penalties — verify before paying extra principal.
What this calculator does not tell you
- –APR including origination points — enter your lender’s APR methodology or add fees separately.
- –Variable rates, interest-only periods, or balloon payments.
- –Credit score, approval odds, or legal terms of the contract.
- –Exact per-diem accrual if your lender uses a non-standard day count.
Frequently Asked Questions
How is the monthly payment calculated?
Using the amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where r is monthly rate and n is months.
APR vs interest rate — which should I compare?
Compare APR. APR includes the stated rate plus lender fees as a yearly percentage.
Sources & References
Editorial & review note
We cross-check amortization against CFPB-style explanations and user-reported edge cases (rounding, extra payments); formula is on-page for transparency.
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Finance & MoneyRelated guides
Loan Repayment Methods: Equal Payment vs. Equal Principal
Compare amortization methods, interest impact, and monthly payment profiles to pick a plan that fits your cash flow.
Mortgage Total Cost: Beyond Principal and Interest
Understand the full monthly cost of home ownership: taxes, insurance, PMI, and how they affect affordability.
Early Repayment Effects: Save Interest and Shorten Term
See how extra principal payments reduce total interest and loan term, and when prepayment penalties apply.
Variable Rate Risks: What Changes When Rates Move
Understand how variable-rate loans can increase payments and total cost, and ways to stress-test scenarios.
Disclaimer: This calculator provides estimates for educational purposes only. It uses a fixed interest rate and does not include origination fees, insurance, taxes, or prepayment penalties. Actual loan terms depend on creditworthiness, lender policies, and prevailing market rates. Always consult a licensed financial professional before making significant borrowing decisions.