Loan Calculator – Estimate Monthly Payments and Total Loan Cost

This free loan calculator helps you estimate your monthly payment, total interest, and full repayment cost using your loan amount, interest rate (APR), and loan term.

It works for most fixed-rate loans with regular monthly payments, including personal loans, auto loans, and basic mortgage estimates. You can also see a full amortization schedule and download your payment breakdown for future reference.

Using this calculator before applying for a loan can help you compare options, avoid surprises, and choose a payment that fits your budget.

How to Use This Loan Calculator

Follow these simple steps:

1. Enter the loan amount

This is the amount of money you plan to borrow from the lender.

2. Enter the interest rate (APR)

Use the annual percentage rate offered by your lender or an estimated market rate.

3. Choose the loan term

Select how long you will take to repay the loan (for example, 36 months, 60 months, or 30 years).

4. Add optional extra payments (if any)

If you plan to pay extra each month or make a one-time extra payment, you can include that to see how it reduces interest and shortens your loan.

5. Click “Calculate”

You will instantly see:

• Estimated monthly payment
• Total interest paid
• Total loan cost (including fees, if added)
• Full amortization schedule showing each payment breakdown

These results help you compare different loan scenarios and choose the most affordable option.

What Each Input Means

Loan Amount

This is the amount you borrow before interest.

Examples:

• $10,000 for a personal loan
• $25,000 for an auto loan
• $300,000 for a home loan

Interest Rate (APR)

APR (Annual Percentage Rate) represents the yearly cost of borrowing money.

It may include:

• The base interest rate
• Certain lender fees (depending on loan type)

A higher APR means:

• Higher monthly payments
• More total interest over time

Even small differences in APR can significantly change the total cost of your loan.

Loan Term

The loan term is how long you take to repay the loan.

Common terms:

• Personal loans: 2 to 7 years
• Auto loans: 3 to 7 years
• Mortgages: 15 to 30 years

Shorter terms:

• Higher monthly payments
• Lower total interest

Longer terms:

• Lower monthly payments
• Higher total interest

Choosing the right term is a balance between affordability and total cost.

How Monthly Loan Payments Are Calculated

Most U.S. installment loans use amortization.

Each monthly payment includes:

• Principal — reduces your loan balance
• Interest — cost charged by the lender

At the beginning of the loan, a larger portion of each payment goes toward interest. Over time, more of your payment goes toward reducing the principal. This is why loan balances drop slowly at first and faster later in the loan.

Loan Payment Formula (For Reference)

Loan calculators use this standard amortization formula:

Monthly Payment = P × r × (1 + r)ⁿ ÷ [(1 + r)ⁿ − 1]

Where:

• P = Loan amount
• r = Monthly interest rate (APR ÷ 12)
• n = Number of monthly payments

You do not need to calculate this yourself — the calculator applies this formula automatically.

Example Loan Calculation

Loan amount: $20,000
APR: 6%
Loan term: 5 years (60 months)

Estimated results:

• Monthly payment: about $387
• Total paid: about $23,220
• Total interest: about $3,220

With extra payments, the loan could be paid off sooner and with less total interest.

Understanding Your Results

Monthly Payment

Shows what you may pay each month based on your inputs.

Total Interest

Shows how much you pay in interest over the full loan term.

Total Cost

Shows the full amount you repay, including interest and optional fees.

Amortization Schedule

Shows each monthly payment with:

• Principal portion
• Interest portion
• Remaining balance

This helps you see how your loan decreases over time.

Why Using a Loan Calculator Is Important

A loan calculator helps you:

• Avoid borrowing more than you can afford
• Compare loan offers
• Choose better repayment terms
• Understand long-term interest costs
• Plan future financial goals

What This Calculator Does Not Include

This calculator does not include:

• Lender-specific fees
• Late payment penalties
• Variable interest rate changes
• Property taxes or insurance for mortgages

Actual loan terms depend on:

• Credit score
• Income and debt level
• Lender policies
• Market interest rates

Always review your official loan agreement before making final decisions.

Who Can Use This Calculator

This calculator is useful for:

• People planning personal loans
• Car buyers estimating auto loans
• Homebuyers reviewing mortgage payments
• Anyone comparing loan options

It is best used during early planning before applying with a bank, credit union, or online lender.

If you are specifically planning to buy a home, you can also use our mortgage calculator to estimate monthly payments for longer loan terms.

Frequently Asked Questions