How to use the loan calculator
- Enter the amount you want to borrow, the yearly interest rate and the loan term in years or months. Any currency works.
- Choose how the loan is repaid. The monthly payment, total interest and total cost update as you type.
- Below, the repayment schedule shows how much of each payment goes to interest and how much reduces the balance. Switch between yearly and monthly rows, or download the table as a CSV file for Excel or Google Sheets.
Repayment types
Equal monthly payments (amortizing)
You pay the same amount every month. Early payments are mostly interest; later ones are mostly principal. This is how most mortgages, car loans and personal loans work. The payment is P × r ÷ (1 − (1 + r)−n), where P is the loan amount, r the monthly interest rate (yearly rate ÷ 12) and n the number of months.
Equal principal payments
The loan balance falls by the same amount each month and interest is paid on what is left, so the first payment is the highest and payments shrink over time. You pay less interest in total than with equal payments, but you need more money at the start.
Interest only (bullet repayment)
You pay only the interest each month and repay the whole loan amount in the last payment. Monthly costs are lowest, but the total interest is the highest, because the balance never goes down.
Example
A 250,000 loan at 5% per year over 30 years with equal payments costs about 1,342 per month. Over 360 months you pay about 233,000 in interest, almost as much as the loan itself. With a 15-year term the payment rises to about 1,977, but the total interest drops to about 106,000.
Good to know
- The calculator assumes a fixed interest rate that is charged monthly. Real loans may also have fees, insurance, taxes or a variable rate, so the lender’s quote can be higher.
- Compare loans by their annual percentage rate (APR) where available, because it includes most fees.
- Paying extra towards the principal early in the loan saves the most interest.