How to use the loan Calculator
- Enter the loan amount.
- Enter the interest rate (APR) (in %).
- Enter the loan term.
- Choose the term in from the list.
- Choose the currency from the list.
- The result updates instantly as you type. There is no button to press.
- Use Copy result to copy the figures, or Copy link to share a link that reopens the loan Calculator with the same inputs.
How it works
Most personal loans, car loans and student loans are amortizing loans: you pay the same amount every month, and each payment covers that month's interest first, with the rest reducing the balance. Early payments are mostly interest because the balance is large. As the balance shrinks, the interest portion falls and more of each payment goes to principal. The schedule above shows that shift year by year.
This calculator converts the annual rate you enter into a monthly rate (APR ÷ 12), finds the level payment that clears the loan in exactly the number of months you choose, and then steps through every month to total the interest. The final payment is adjusted by a few cents so the balance lands on exactly zero.
Two loans with the same rate can cost very different amounts. Stretching a loan over a longer term lowers the monthly payment but raises the total interest, often by thousands. Try changing the term to see the trade-off. If your lender quotes fees separately, such as an origination fee, add them to the loan amount to see their true cost.
Formula
where M is the monthly payment, P the amount borrowed, r the monthly interest rate (annual rate ÷ 12 ÷ 100) and n the number of monthly payments. If the rate is 0%, the payment is simply P ÷ n. Total interest is (M × n) − P.
Example
You borrow $25,000 for 5 years at 7.5% APR. The monthly rate is 0.075 ÷ 12 = 0.00625 and there are 60 payments. Plugging in: M = 25,000 × 0.00625 ÷ (1 − 1.00625^−60) ≈ $500.95 a month. Over 60 months you repay about $30,056.92, so the loan costs roughly $5,056.92 in interest, about 20% of the amount borrowed. Spread over 7 years instead, the payment drops to about $383 but the interest rises to over $7,200.
Frequently asked questions
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal. The APR (annual percentage rate) also folds in certain required fees, so it is usually a little higher and is the better number for comparing offers. Enter whichever rate your lender uses to calculate payments.
Does paying extra each month save money?
Yes. Any extra payment goes straight to principal, which lowers the balance that future interest is charged on. Even small extra payments shorten the loan and cut total interest. Check that your lender has no prepayment penalty.
Why is my lender's payment slightly different?
Lenders may calculate interest daily rather than monthly, round each payment differently, or add insurance and fees to the payment. The difference is usually a few cents to a few dollars a month.
Can I use this for an EMI calculation?
Yes. An EMI (equated monthly instalment) is exactly the level monthly payment this calculator finds. Choose your currency, enter the loan amount, the annual rate and the tenure in months or years.
Disclaimer: This calculator gives estimates for general information and education. It is not financial, tax or investment advice. Lenders, banks and tax authorities may round differently, charge fees or apply rules this tool does not model, so confirm figures with a qualified professional or your provider before making decisions.