Loan Calculator
Estimate your monthly payments, total interest, and total cost for any loan.
Monthly Payment
$0.00
Total Interest
$0.00
Total Repayment
$0.00
Amortization Schedule
| Month | Principal | Interest | Balance |
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Why Use This Tool? ✅
Plan Smarter
Helps you budget effectively and understand the long-term cost of borrowing money.
Quick & Accurate
Get instant results based on standard financial formulas, avoiding manual errors.
Compare Loan Options
Easily change inputs to see how different interest rates or terms affect your payments.
For Any Loan Type
Works for mortgages, car loans, personal loans, student debt, and more.
Understanding Your Loan: A Guide to Borrowing 💳
Taking out a loan is a major financial decision. Whether it's for a house, a car, or education, understanding the components of your loan is key to managing your debt effectively. This calculator breaks down the numbers to give you a clear, transparent view of your financial commitment.
Key Loan Components
- Loan Amount (Principal): This is the initial amount of money you borrow from the lender.
- Interest Rate (APR): The Annual Percentage Rate is the cost of borrowing money, expressed as a yearly percentage. Our calculator uses this to determine the monthly interest.
- Loan Term: This is the length of time you have to repay the loan, typically expressed in years or months.
How Are Monthly Payments Calculated?
Your monthly payment is calculated using a standard formula that ensures your loan is paid off by the end of the term. Each payment is split into two parts: a portion that pays down the interest accrued that month, and a portion that pays down your principal balance.
This process is called amortization. At the beginning of your loan, a larger portion of your payment goes toward interest. As you pay down the principal, the interest portion decreases, and the principal portion increases with each payment. Our amortization schedule below the main results shows you this breakdown for every single month of your loan.
Why Total Interest Matters
While the monthly payment is important for budgeting, the total interest paid reveals the true cost of your loan over its lifetime. A lower interest rate or a shorter loan term can dramatically reduce the total amount of interest you pay, saving you thousands of dollars. Use this calculator to experiment with different scenarios and see how these factors impact your overall cost, empowering you to make the smartest financial decision.