Calculate your exact monthly loan payment and total interest for any fixed-rate loan. Enter your loan amount, annual interest rate, and term in months to instantly see your payment breakdown and estimated payoff date.
This calculator uses the standard amortizing loan formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where M is the monthly payment, P is the principal loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments. This formula produces a fixed payment that covers both accruing interest and principal repayment, with the balance reaching exactly zero on the final payment.
In the early months of a loan, most of each payment goes toward interest. As the principal balance decreases, the interest portion shrinks and more of each payment reduces the principal. This is called amortization. For example, on a 3-year loan at 8.5%, roughly 70% of your first payment is interest, while over 90% of your last payment is principal.
Loan: $10,000 | Rate: 8.5% APR | Term: 36 months. Monthly payment = $315.57. Total interest paid = $1,360.52. Total cost = $11,360.52.
Loan: $28,000 | Rate: 6.9% APR | Term: 60 months. Monthly payment = $551.88. Total interest = $5,112.80. Total cost = $33,112.80. Compare this to a 48-month term at the same rate: monthly payment = $668.09, but total interest drops to $4,068.32 — saving $1,044 by paying $116 more per month.
$15,000 loan over 48 months at 7% vs 12%: At 7%, monthly payment = $358.74, total interest = $2,219.52. At 12%, monthly payment = $394.87, total interest = $3,953.76. The 5% rate difference costs an additional $1,734 in interest on a relatively modest loan.
This calculator works for any fixed-rate, fully amortizing installment loan. Common applications include personal loans (debt consolidation, home improvement, emergencies), auto loans, student loan refinancing, small business loans, and boat or RV financing. It does not apply to credit cards (which use revolving credit), variable-rate loans (where the rate changes over time), or interest-only loans.
The two most powerful levers for reducing the total cost of a loan are the interest rate and the loan term. Shopping multiple lenders before accepting an offer is one of the most impactful steps you can take — even a 1% rate reduction on a $20,000 loan saves hundreds of dollars. Choosing the shortest term you can comfortably afford dramatically reduces total interest. Making extra payments directly reduces principal and cuts the effective term of the loan, saving interest proportionally. Some lenders also allow biweekly payments instead of monthly, which results in one extra payment per year and meaningful interest savings.
The interest rate is the base cost of borrowing expressed as a percentage. The Annual Percentage Rate (APR) includes the interest rate plus any fees charged by the lender (origination fees, processing fees, etc.), expressed as a yearly rate. APR gives you a more complete picture of the true cost of the loan. Always compare APRs when shopping for loans, not just interest rates.
Credit score requirements vary by lender and loan type. Generally, a score above 740 qualifies for the best rates. Scores of 680–739 get good rates. Scores of 620–679 get average rates. Below 620, many lenders will decline or charge very high rates. Improving your credit score before applying can save significantly.
Many personal and auto loans allow early payoff without penalty, but some charge a prepayment penalty — typically 1–3% of the remaining balance. Always check your loan agreement before making extra payments or paying off early. If your loan has no prepayment penalty, extra payments directly reduce principal and save interest.
A longer term reduces monthly payments but increases total interest paid. A shorter term increases monthly payments but significantly reduces total interest. Use this calculator to compare different terms with your specific loan amount and rate to find the right balance for your budget.
A secured loan is backed by collateral — an asset the lender can seize if you default (like a car in an auto loan or your home in a mortgage). An unsecured loan has no collateral. Because secured loans carry less risk for the lender, they typically have lower interest rates. Personal loans are usually unsecured, which is why their rates are higher than mortgage or auto loan rates.