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Loan Calculator
Calculate your monthly loan payment, total interest paid, and full loan cost in seconds.
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Monthly Payment
Total Payment
Total Interest
Loan Amount
Calculated in your browser. We never see your numbers.
How to Use This Calculator
Enter your loan amount in the first field and the annual interest rate you expect to receive. Select your desired loan term from 1 to 10 years, then choose your loan type (Personal, Auto, Student, or Business — this is for reference only and doesn't affect the calculation). Results update instantly as you type. You'll see your estimated monthly payment, total amount paid over the life of the loan, total interest charged, and the original loan amount for easy comparison.
Loan Payment Formula
The monthly loan payment is calculated using the standard amortization 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 divided by 12), and n is the total number of monthly payments (term in years × 12). For example, a $10,000 loan at 5% for 5 years: r = 0.05/12 ≈ 0.004167, n = 60. M = $10,000 × 0.004167 × (1.004167)^60 / ((1.004167)^60 − 1) ≈ $188.71 per month. For a 0% interest rate, the formula simplifies to principal ÷ number of months.
Example Calculation
Suppose you borrow $10,000 at a 5% annual interest rate over 5 years. Your monthly payment would be $188.71. Over 60 months, you'd pay $11,322.74 total — meaning $1,322.74 in total interest on top of the $10,000 principal. If instead you chose a 3-year term at the same rate, your monthly payment jumps to $299.71, but total interest drops to just $787.56 — saving over $535 in interest.
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Frequently Asked Questions
How is the monthly loan payment calculated?
Your monthly payment is calculated using the standard amortization formula: M = 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 payments (term in years × 12). For a 0% interest rate, the payment is simply the principal divided by the number of months.
What's the difference between a personal, auto, student, and business loan?
The loan type is primarily a label — all four use the same standard amortization formula. The differences lie in eligibility requirements, typical interest rates, and repayment flexibility. Personal loans are unsecured with flexible use. Auto loans are secured by the vehicle. Student loans may offer income-based repayment. Business loans are for commercial purposes and may have different approval criteria.
How does the interest rate affect my payment?
Even a small difference in interest rate significantly impacts your total cost. For example, on a $10,000 loan over 5 years, the difference between 5% and 8% interest means paying about $83 more per month and over $1,500 more in total interest. Shopping for the lowest rate possible — even a fraction of a percent lower — can save meaningful money over the loan term.
Should I choose a shorter or longer loan term?
A shorter term means higher monthly payments but less total interest paid overall. A longer term gives you lower monthly payments but you pay significantly more interest over time. Use this calculator to compare both scenarios. If you can comfortably afford the higher monthly payment, a shorter term is almost always the better financial choice.
What is total interest on a loan?
Total interest is the sum of all interest charges you pay over the life of the loan — calculated as total payment minus the original loan amount. For example, borrowing $10,000 at 5% for 5 years results in $1,322.74 in total interest. The longer your loan term or the higher your rate, the more interest you'll pay.
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