Loan Calculator
Calculate the monthly repayment, total interest and total cost of a personal, car or business loan, with a yearly amortisation breakdown.
- Category
- Calculators
- Updated
- Cost
- Free · no sign-up
Monthly payment
$400.76
Over 60 payments.
Assumes a fixed rate and equal payments. Fees and insurance charged separately by the lender aren't included.
Yearly breakdown
| Year | Interest | Principal | Balance |
|---|---|---|---|
| 1 | $1,384 | $3,425 | $16,575 |
| 2 | $1,118 | $3,691 | $12,884 |
| 3 | $831 | $3,978 | $8,906 |
| 4 | $523 | $4,287 | $4,619 |
| 5 | $190 | $4,619 | $0 |
How a loan payment is calculated
Most consumer loans use level payments — the same amount every month for the whole term. The formula behind it:
payment = P × r ÷ (1 − (1 + r)^−n)
where P is the principal, r is the monthly interest rate (annual rate ÷ 12)
and n is the number of payments. Each payment covers the interest accrued that
month first; whatever's left reduces the balance.
Why early payments feel like they achieve nothing
Because interest is charged on the outstanding balance, the split between interest and principal shifts over the life of the loan. On a 20,000 loan at 7.5% over five years, the first payment is about 125 interest and 276 principal. The final payment is roughly 2 interest and 398 principal.
This is also why overpaying early is so effective. Money paid off the principal in year one removes every future interest charge that principal would have generated. The same overpayment in the final year saves almost nothing.
Interest rate versus APR
The interest rate is the cost of borrowing the money. The APR folds in mandatory fees — arrangement charges, broker fees, some insurance — and expresses the total as an annual percentage. Two loans with identical interest rates can have very different APRs.
Compare offers on APR, and check what the lender has included, because the rules differ by jurisdiction.
Term length is a real trade-off
Stretching a loan lowers the monthly payment and raises the total cost, often sharply. The monthly figure is what most people shop on, and it's the number lenders lead with. Look at total interest before deciding a longer term is affordable.
How to use the Loan Calculator
Three steps, no sign-up.
Enter the amount you're borrowing
Use the amount after any deposit or trade-in.
Add the interest rate and term
Use the APR if you have it — it includes most fees, so it's the fairer comparison.
Compare total cost, not just the monthly figure
A longer term lowers the monthly payment and raises the total interest, often by a lot.
Worked examples
A $20,000 car loan over 5 years at 7.5%
- Inputs
- $20,000 · 7.5% · 60 months
- Result
- $400.76 a month · $4,046 total interest