Loan Calculator
Use this calculator to see your estimated monthly payment and total interest for a fixed-rate loan. Enter the loan amount, annual interest rate, and term in years. Results update as you type—no submit button required.
Calculate your payment
How it works
Loans are typically repaid in equal monthly installments. Each payment covers part of the principal and part of the interest. The formula used here is the standard amortization formula:
Monthly payment = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments.
Example: A $20,000 loan at 6.5% for 5 years gives a monthly payment of about $391. Total paid over the term is about $23,460, so total interest is about $3,460. Early in the term, most of each payment goes to interest; over time, more goes to principal.
When to use a loan calculator
Borrowers use loan calculators to compare offers, plan budgets, and see how term or rate changes affect the payment. Before applying for a car loan, personal loan, or other installment credit, run a few scenarios: shorter terms usually mean higher monthly payments but less total interest. Use this tool alongside your lender’s official quote, which may include fees or insurance.
Frequently asked questions
- How is the monthly loan payment calculated? The monthly payment uses the standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is principal, r is the monthly interest rate (annual rate / 12), and n is the number of payments.
- Does this calculator work for car loans and personal loans? Yes. Any fixed-rate loan with a fixed term can be calculated with this tool—car loans, personal loans, and other installment loans use the same math.
- Why does my result differ from the lender's quote? Lenders may include fees, insurance, or use a different compounding assumption. This calculator shows the principal-and-interest portion only; always confirm with your lender.