Loan Calculator
Calculate monthly payments, total interest, and total cost for any personal or business loan. Includes a full amortization schedule with extra payment savings.
Loan Calculator
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Balance Over Time
Loan Amount
$25,000
Total Interest
$5,057
Interest Saved
$1,014
Time Saved
11 mo
New Payoff
Jun 2030
| Original | With Extra | |
|---|---|---|
| Monthly Payment | $500.95 | $600.95 |
| Total Interest | $5,057 | $4,043 |
| Total Payments | $30,057 | $29,043 |
| Payoff Date | May 2031 | Jun 2030 |
| Loan Term | 5 yr | 4 yr 1 mo |
Payoff Comparison
| Year | Interest | Principal | Balance |
|---|---|---|---|
| 1 | $1,189 | $2,819 | $22,181 |
| 2 | $1,511 | $4,500 | $17,681 |
| 3 | $1,162 | $4,850 | $12,831 |
| 4 | $785 | $5,226 | $7,605 |
| 5 | $379 | $5,632 | $1,973 |
| 6 | $31 | $1,973 | — |
The Formula
Monthly payment is calculated using the standard loan amortization formula — the same math used for auto loans, personal loans, and mortgages. This formula ensures each payment is exactly the same amount throughout the life of the loan, with the proportion allocated to interest decreasing over time as the principal balance shrinks.
Variable Definitions
Monthly Payment
The fixed amount paid each month toward both principal and interest. This amount stays constant for the entire loan term, but the split between principal and interest changes with each payment.
Loan Amount & Duration
The principal (P) is the total borrowed; the term (n) is the duration in months. A 5-year $20,000 loan has P=$20,000 and n=60. Together these determine the payment amount and total interest cost.
Monthly Rate
The annual interest rate divided by 12. This periodic rate is applied to the outstanding balance each month to calculate the interest portion of the payment.
How to Use This Calculator
- 1
Enter the loan amount, annual interest rate (APR), and choose between years or months for the term.
- 2
Enter the term duration and review your monthly payment, total interest, and total cost.
- 3
Scroll down to view the full amortization schedule showing each payment split month by month.
Common Applications
- Compare monthly payments across different loan terms to find the best balance between affordable payments and total interest cost.
- Calculate the true total cost of a loan including all principal and interest payments over the full amortization period.
- Experiment with extra payments to see how much interest you can save and how early you can become debt-free.
Typical loan total cost breakdown — principal vs. interest over the full term
Understanding the Concept
Every loan payment is split between interest and principal repayment. Early in the loan term, most of each payment goes toward interest because the outstanding balance is largest. Over time, as the principal shrinks, less interest accrues and more of each payment goes toward reducing the balance. This is called amortization. The amortization schedule below shows exactly how each payment is allocated month by month and year by year. Use it to understand the true cost of your loan, see how much interest you will pay over the full term, and experiment with extra payments to see how much you could save by paying off the loan early.
Frequently Asked Questions
Sources & References
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