Loan Calculator

Figuring out what a loan will actually cost you shouldn't require a finance degree. Punch in your loan amount, interest rate, and repayment term above, and this calculator will show you your monthly payment, the total interest you'll pay over the life of the loan, and the full amount you'll hand back to the lender by the time it's paid off.

It works for pretty much any fixed-term loan with regular payments, personal loans, car loans, education loans, or a straightforward home loan. If your loan has a different structure, like a balloon payment at the end or a variable rate that changes annually, the numbers here will still give you a solid starting estimate, though your actual statement may differ slightly.

How the calculation works

Most loans use what's called amortization, a fancy word for a simple idea. Every payment you make is split between two things: interest owed on the money you still have outstanding and principal, which is the actual amount you borrowed. Early in the loan, most of your payment goes toward interest because your outstanding balance is still high. As you keep paying, the balance shrinks, so less of each payment goes to interest and more chips away at the principal.

This is why two loans with the same monthly payment can leave you in very different positions after three years; the one with the higher interest rate pays down principal much more slowly.

The math behind it comes down to three inputs: how much you borrowed, the annual interest rate, and how many months or years you'll take to repay it. The calculator converts your annual rate into a monthly rate, then works out the fixed payment that will bring your balance to exactly zero by the final month, accounting for interest charged along the way.

What each input actually means

• Loan amount is the principal, the amount you're borrowing, not including any interest or fees the lender adds later.
• Interest rate should be the annual rate your lender quotes, usually written as an APR. If your lender gives you a monthly rate instead, multiply it by 12 before entering it here.
• Loan term is how long you'll be repaying, most people enter this in years, but if your lender talks in months (common for personal loans and auto loans), switch the toggle so the numbers line up.

A small change in any of these three moves the result more than most people expect. Stretching a loan from 3 years to 5 years, for instance, usually lowers the monthly payment noticeably, but it also means paying interest for two extra years, which can add up to more total interest even though each individual payment feels lighter.

Fixed rate vs. reducing balance

Some lenders (particularly for personal and consumer loans in certain markets) quote a "flat rate," where interest is calculated on the full original loan amount for the entire term, rather than on the shrinking balance. A flat rate of, say, 10% will end up costing you noticeably more than a reducing-balance rate of 10%, even though the number on paper looks identical. If your loan offer mentions a flat or flat-effective rate, ask the lender for the equivalent reducing-balance APR before comparing it against other offers, otherwise you're not comparing like with like.

Getting the most accurate estimate

A few things this calculator can't see, but you should factor in yourself:

Processing fees, origination charges, or insurance add-ons that some lenders bundle into the loan, these increase what you actually pay back even if they don't change the quoted interest rate.

Prepayment or foreclosure charges, which some lenders apply if you pay off the loan early. If you're planning to pay extra whenever you can, check this before you sign anything.

Rates change if your loan isn't fixed. This calculator assumes the rate you enter stays constant for the full term, which is accurate for fixed-rate loans but only a snapshot for variable-rate ones.

Ways to lower what you pay in interest

Making even one extra payment a year toward the principal, if your loan allows it without penalty, can shave a meaningful chunk off both your interest total and your payoff date. Try running the numbers with a shorter term to see the difference for yourself.

Improving your credit profile before you apply matters more than most people realize. Even a one-point difference in your approved interest rate compounds into real money over a multi-year term.

Comparing the total interest figure, not just the monthly payment, when you're weighing offers from different lenders. A lower monthly payment stretched over a longer term can end up costing more overall.

Frequently Asked Questions