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Loan Payment Calculator

Estimate monthly loan payments before you borrow or refinance. Enter the loan amount, interest rate, and term to see the payment, total interest, and full repayment amount so you can compare scenarios with confidence.

The total amount you want to borrow.

Annual percentage rate (APR).

12 months = 1 year, 60 months = 5 years, 360 months = 30 years.

How to Use

1 Enter the total loan amount you want to borrow.
2 Enter the annual interest rate (APR).
3 Enter the loan term in months.
4 Click Calculate.
5 Review your monthly payment, total cost, and total interest.
6 Change the rate or term to compare cheaper and more expensive loan options.

Formula

Monthly Payment P x [r(1+r)^n] / [(1+r)^n - 1]
Where r = annual rate / 12, n = number of months
Total Payment Monthly Payment x n
Total Interest Total Payment - Loan Amount

Example Calculation

If you borrow $25,000 at 5.5% APR for 60 months (5 years):

Monthly rate r = 5.5 / 12 = 0.4583%
Monthly Payment = $477.23
Total Payment = $477.23 x 60 = $28,634.10
Total Interest = $28,634.10 - $25,000 = $3,634.10

You would pay $3,634.10 in interest over 5 years.

Why It Matters

A loan payment that looks manageable on paper can still become expensive over time. Seeing the payment and total interest together helps you choose a term that fits your cash flow without quietly adding thousands of dollars in borrowing cost.

Who Uses This Calculator?

  • • People comparing loan, mortgage, salary, savings, tax, or investment scenarios before making a money decision.
  • • Homeowners, borrowers, employees, freelancers, and small business owners who need fast estimates without a spreadsheet.
  • • Anyone who wants to understand the inputs, formula, and tradeoffs behind a financial result.

Frequently Asked Questions

How is the monthly payment calculated?
The monthly payment is calculated using the amortization formula. It takes into account the loan amount, the monthly interest rate (annual rate divided by 12), and the total number of payments. The formula ensures that each monthly payment covers both interest and a portion of the principal, so the loan is fully paid off by the end of the term.
What happens if I pay extra each month?
Paying extra reduces the principal balance faster, which means you pay less interest overall and pay off the loan sooner. Even an extra $50-$100 per month can save you hundreds or thousands in interest and cut months off your loan term. Check with your lender about prepayment penalties first.
What is the difference between fixed and variable rate?
A fixed rate stays the same for the entire loan term, so your monthly payment is predictable. A variable rate can change over time based on market conditions, so your payment could go up or down. Fixed rates are easier to budget for, while variable rates may start lower but carry more risk.
How does loan term affect my payment?
A longer term lowers your monthly payment but increases total interest paid. A shorter term means higher monthly payments but you save significantly on interest. For example, a $25,000 loan at 5.5% costs $477/month over 5 years ($3,634 interest) but $330/month over 10 years ($6,568 interest).
Can this help me compare refinance offers?
Yes. Run your current loan and a proposed refinance with the same remaining balance to compare monthly payment, total interest, and term length. A lower payment is not always a better deal if the new term is much longer or fees are high.
Can I use this for mortgages?
Yes, this calculator works for any fixed-rate amortizing loan, including mortgages, auto loans, personal loans, and student loans. For mortgages, remember to also consider property tax, insurance, and PMI, which are not included in this calculation.

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This calculator provides estimates for informational purposes only and is not financial, tax, or legal advice. Consult a qualified professional before making financial decisions.