Loan Calculator
Monthly payments and total interest
Monthly Payment
Total Payment
Total Interest
Interest % of Loan
How it works
Enter your loan amount, annual interest rate, and loan term (in years or months). The calculator shows your monthly payment, total amount you'll pay back, and how much of that is interest.
What you need
- Loan Amount: The principal you're borrowing
- Annual Interest Rate: The yearly interest percentage set by your lender
- Loan Term: How long you have to pay it back (years or months)
The results
- Monthly Payment: What you pay each month
- Total Payment: Sum of all payments over the life of the loan
- Total Interest: How much extra you pay beyond the original loan amount
- Interest % of Loan: Total interest as a percentage of the principal
Amortization
Most loans use amortisation: every monthly payment is the same fixed amount, but the split between interest and principal shifts over time. Early payments are mostly interest because your outstanding balance is highest. As you pay down the principal, less interest accrues each month, so more of each payment chips away at the balance. By the final payment almost nothing goes to interest.
The formula
The monthly payment M is calculated using the standard amortisation formula, where P is principal, r is the monthly interest rate (annual rate / 12), and n is total number of payments.
M = P × [r(1+r)ⁿ] / [(1+r)ⁿ - 1]
Why longer terms cost more
Extending a loan term lowers your monthly payment but dramatically increases total interest paid. A $20,000 loan at 6% over 3 years costs about $1,860 in interest; the same loan over 6 years costs about $3,760 (more than double). The lower payment feels easier monthly, but you pay the lender for twice as long.