Loan Calculator
Calculate monthly payment, total interest, and total cost for any fixed-rate loan. Works for personal, auto, student, and small-business loans.
What this calculates
A loan calculator answers the most common borrowing question: how much will this cost me each month, and how much will I pay in interest overall? This tool works for any fixed-rate, fixed-term installment loan — personal, auto, student, or small business. Enter the amount you're borrowing, the annual interest rate, and the term in months or years, and you'll see your full payment breakdown.
Formula & how it works
The fixed-rate installment loan uses the same amortization math as a mortgage: M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1). P is the loan principal, r is the monthly interest rate (annual ÷ 12), and n is the total number of payments. Each month a portion of the payment covers interest on the current balance and the rest reduces the principal, so the interest share shrinks every month while the principal share grows.
Worked example
Borrow $20,000 for a car at 7.5 % over 5 years. Monthly rate r = 0.075 ÷ 12 = 0.00625. Number of payments n = 60. M = 20 000 × 0.00625 × (1.00625)^60 ÷ ((1.00625)^60 − 1) ≈ $400.76. Over the full 60 months you pay $24,045.60, of which $4,045.60 is interest — roughly 20 % of the original loan, paid on top of the principal.
Frequently asked questions
What's the difference between APR and interest rate?
The interest rate is what the lender charges on the principal. The APR (Annual Percentage Rate) bundles in fees and origination costs, so it's the more honest measure of total cost. For a calculator like this, enter the APR if available — it gives you the true monthly payment including fee impact.
Should I choose a longer or shorter term?
A longer term reduces the monthly payment but raises the total interest you pay. A shorter term means higher monthly payments but much less interest overall. Pick the shortest term whose monthly payment still fits comfortably in your budget.
Can I pay off my loan early?
Most installment loans allow early payoff, but some have prepayment penalties — especially mortgages and some auto loans. Check your contract. When allowed, paying extra principal directly shrinks the interest you'll owe on every subsequent payment.
Does this work for credit cards?
Not really. Credit cards are revolving credit, not installment loans — the balance and minimum payment fluctuate. Use a credit-card payoff calculator instead, which models a fixed monthly payment against a compounding balance.
Sources
Disclaimer: Informational only — not financial advice. Verify rates and terms with your lender before signing.
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