Loan Payment Calculator
Enter the amount, the annual rate, and the term. Math only, not financial advice.
The formula
Fixed-rate loans use the standard amortization formula: payment = P × r × (1 + r)n ÷ ((1 + r)n − 1), where P is the amount borrowed, r is the monthly rate (the annual rate ÷ 12), and n is the number of monthly payments. Borrowing $20,000 at 6.5% for 5 years gives a payment of $391.32 a month and $3,479.38 of interest in total.
How payments split over time
The payment stays the same, but its make-up changes. In the first month of that example, $108.33 goes to interest and the rest to the balance. As the balance falls, less of each payment goes to interest and more to the balance, which is why paying extra early saves the most.
Monthly payment on $20,000
| Rate | 3 years | 5 years | 7 years |
|---|---|---|---|
| 4% | $590.48 | $368.33 | $273.38 |
| 6% | $608.44 | $386.66 | $292.17 |
| 8% | $626.73 | $405.53 | $311.72 |
| 10% | $645.34 | $424.94 | $332.02 |
| 12% | $664.29 | $444.89 | $353.05 |
Total interest on $20,000
| Rate | 3 years | 5 years | 7 years |
|---|---|---|---|
| 4% | $1,257 | $2,100 | $2,964 |
| 6% | $1,904 | $3,199 | $4,542 |
| 8% | $2,562 | $4,332 | $6,185 |
| 10% | $3,232 | $5,496 | $7,890 |
| 12% | $3,914 | $6,693 | $9,657 |
A longer term lowers the monthly payment but raises the total interest, often by a lot. Which is better depends on whether monthly cash flow or total cost matters more to you.
Interest rate versus APR
Lenders usually quote both an interest rate and an APR (annual percentage rate). The APR includes certain fees, so it is normally higher and is the fairer number for comparing offers. To compare two loans here, enter each one’s APR.
What isn’t included
The calculator assumes a fixed rate, monthly payments, and no extra payments, fees, insurance, or taxes. Mortgage payments often include property tax and insurance on top of this figure. Check with the lender for the exact numbers before borrowing.