Understanding Loan Calculations
A loan calculator is an essential financial tool that helps you understand the true cost of borrowing money. Whether you're considering a personal loan, auto loan, mortgage, or business financing, our calculator provides accurate monthly payment estimates and total interest calculations.
Our calculator uses the standard loan formula: M = P × [r(1+r)^n] / [(1+r)^n – 1], where M is monthly payment, P is principal, r is monthly interest rate, and n is number of payments.
Loan Calculator Benefits
- Compare different loan terms
- Plan your monthly budget
- Understand total interest costs
- Evaluate extra payment benefits
Types of Loans You Can Calculate
Auto Loans
Calculate payments for new and used car loans. Typical terms: 3-7 years, rates: 3-8% APR.
- • New car loans: $10,000 - $100,000+
- • Used car loans: $5,000 - $50,000
- • Certified pre-owned financing
Personal Loans
Unsecured loans for debt consolidation, home improvements, or major purchases. Terms: 2-7 years.
- • Loan amounts: $1,000 - $100,000
- • Fixed interest rates: 5-36% APR
- • No collateral required
Mortgage Loans
Home purchase and refinance loans. Standard terms: 15-30 years, current rates vary by market.
- • Conventional mortgages
- • FHA, VA, USDA loans
- • Jumbo loans for high-value homes
Business Loans
Small business financing for equipment, working capital, or expansion. Terms vary widely.
- • SBA loans: $500 - $5 million
- • Equipment financing
- • Business lines of credit
How to Use the Loan Calculator
- Enter Loan Amount: Input the total amount you want to borrow
- Set Interest Rate: Enter the annual percentage rate (APR) offered by your lender
- Choose Loan Term: Select the repayment period in years or months
- Add Extra Payments (Optional): Enter additional monthly payments to see interest savings
- Select Loan Type: Choose the appropriate loan category for relevant advice
- Calculate: View your monthly payment, total cost, and amortization schedule
Frequently Asked Questions
What factors affect my loan interest rate?
Credit score, income, debt-to-income ratio, loan amount, loan term, down payment, and current market rates all influence your interest rate.
Should I make extra payments on my loan?
Extra payments can save significant interest if you have high-rate debt. However, consider investing extra money if you have low-rate loans and can earn higher returns elsewhere.
How accurate is this loan calculator?
Our calculator provides precise estimates based on the loan formula used by financial institutions. Actual payments may vary slightly due to fees, insurance, or payment timing.
What's the difference between APR and interest rate?
Interest rate is the cost of borrowing, while APR includes the interest rate plus fees and other costs. APR gives a more complete picture of the loan's true cost.