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Loan Calculator

Use this loan calculator to estimate your monthly payment, total interest, and full repayment cost for any amortized loan.

The total amount you plan to borrow (principal).

The yearly interest rate charged by the lender as a percentage.

The total repayment period in years.

This calculator helps users estimate how much they will pay each month and how much interest they will pay over the full loan term. Perfect for personal loans, auto loans, and student loans.

How It Works

Amortized Loan Payment Formula

M = P x [r(1+r)^n] / [(1+r)^n - 1]

Monthly payment equals principal times the monthly rate growth factor divided by the growth factor minus one.

M is the monthly payment

P is the principal or loan amount

r is the monthly interest rate (annual rate divided by 12)

n is the total number of monthly payments (years multiplied by 12)

Important Notes:

  • •This calculator assumes a fixed interest rate for the entire loan term.
  • •Payments are calculated using the standard amortization formula.
  • •This version does not include origination fees, insurance, or other additional costs.

Worked Example

A user borrows $20,000 at 6% annual interest for 5 years.

Inputs:

  • loan Amount:20,000
  • annual Interest Rate:6
  • loan Term Years:5

Result:

The monthly payment would be approximately $386.66. Total interest paid over 5 years would be $3,199.60, making the total repayment cost $23,199.60.

Who Is This Calculator For?

  • borrowers
  • home buyers
  • car buyers
  • students

Frequently Asked Questions

Monthly payments are calculated using an amortization formula that accounts for the loan amount, interest rate, and repayment term. The formula ensures that each payment covers both interest and a portion of the principal so the loan is fully repaid by the end of the term.
No, this calculator only shows principal and interest. Many loans also include origination fees, closing costs, insurance, and other charges that can increase your actual cost.
The interest rate is the cost of borrowing expressed as a percentage. APR (Annual Percentage Rate) includes both the interest rate and certain fees, giving you a more complete picture of borrowing costs.
A shorter term means higher monthly payments but less total interest. A longer term means lower monthly payments but more total interest. Choose based on what fits your budget and how much total interest you're willing to pay.

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Last updated: March 11, 2025