Result
- Total of payments$30,056.92
- Total interest$5,056.92
- Principal$25,000.00
- Number of payments60
How to use this calculator
- Enter the loan amount you want to borrow (the principal).
- Type the lender's quoted APR — match the period (annual) shown on your offer.
- Set the term in years; results refresh as you type.
- Compare a shorter term to see lifetime interest savings.
About this tool
Use the loan calculator to figure out the true cost of any fixed-rate installment loan. Enter the amount you want to borrow, the annual percentage rate (APR) the lender quoted, and the term in years — the calculator immediately shows the monthly payment, the total amount you'll pay back, and how much of that is pure interest. The math uses the standard amortization formula, the same one banks use, so the numbers match what you'll see on a paper offer. Slide the term shorter to see how much interest you save; nudge the rate to see what an extra half-percent really costs.
What this calculator does
This calculator returns the monthly payment, total interest, and full lifetime cost of any fixed-rate, fully-amortizing installment loan — personal, auto, student, or any other consumer credit product whose schedule clears the balance to zero by the final scheduled payment. It uses the standard amortization formula required by the Truth in Lending Act and lets you flex the term shorter and the rate up or down by 1% to see how lifetime interest moves. Variable-rate, balloon, and interest-only loans are not modelled — those need different math.
How it works — the formula
Payment M = P · r(1+r)ⁿ / ((1+r)ⁿ − 1); APR = rate that equates payments to net cash advanced (per Reg Z App J)P is the financed amount, r is the periodic rate (annual ÷ payments per year), and n is the number of scheduled payments. The Truth in Lending Act mandates lenders disclose APR — a figure that folds finance charges (origination fees, mortgage insurance, certain points) into the periodic rate per the algorithm in 12 CFR §1026 Appendix J. APR is what makes two loans with different fees genuinely comparable.
Worked examples
- Inputs:
- P = $20,000, rate = 8%, term = 60 months
- Output:
- Monthly ≈ $405.53; total interest ≈ $4,332
Total interest is ~22% of principal — a typical figure for an 8% unsecured personal loan at 60 months.
- Inputs:
- P = $35,000, rate = 6.5%, term = 72 months
- Output:
- Monthly ≈ $588.35; total interest ≈ $7,361
Stretching the term from 60 to 72 months drops the payment but adds ~$1,400 in lifetime interest. Borrowers also stay underwater on the vehicle longer.
- Inputs:
- P = $30,000, rate = 5%, term = 120 months
- Output:
- Monthly ≈ $318.20; total interest ≈ $8,184
Federal student loans use simple-daily-interest accrual; this monthly-periodic figure is within 1–2% of the true federal schedule.
When to use this vs other tools
Loan Calculator is the general-purpose amortization tool. Use one of the specialised tools when the loan type has extras this one does not model.
- Mortgage Calculator
Use for a home loan — Mortgage Calculator adds property tax, home insurance, and a PMI advisory, all of which materially affect the real monthly figure.
- Car Loan Calculator
Use for an auto loan — Car Loan Calculator handles trade-in value, dealer-financing quirks, and the 36-to-84-month term range typical of vehicle finance.
- Personal Loan Calculator
Use for an unsecured personal loan when origination fees are material — Personal Loan Calculator factors the origination-fee deduction into the true APR.
- Refinance Calculator
Use after you have an existing loan and rates have moved — Refinance Calculator returns break-even months on closing costs vs the new monthly savings.
Authority note
Appendix J of Regulation Z prescribes the exact algorithm every US lender must use to compute APR. That makes the monthly-payment math in this calculator directly comparable to the Truth-in-Lending disclosure on any consumer-loan offer.
Limitations
- Variable-rate, balloon, and interest-only loans require different formulas and are not modeled.
- Origination fees, prepayment penalties, late fees, and servicing fees are not included in the basic interest-rate calculation — request the lender's APR for the full cost.
- Federal student loans use simple-daily-interest accrual rather than monthly periodic compounding; results differ by 1–2% over multi-year payoffs.
- Late or skipped payments add capitalized interest that is not modeled here.
Loan calculations are estimates. This calculator does not provide financial advice — confirm figures against the lender's federally-required Truth in Lending disclosure before signing.