⚖️ Loan Comparison Calculator
Compare two loans side-by-side
Loan 1
Loan 2
How to Use This Calculator
Enter Loan Amount
Input the loan amount you want to compare. This should be the same for both loans.
Enter Loan 1 Details
Enter the interest rate and loan term for the first loan option you're considering.
Enter Loan 2 Details
Enter the interest rate and loan term for the second loan option you're considering.
Review Comparison
See side-by-side comparison of monthly payments, total interest, and total cost. Use this to choose the best loan for your situation.
Formula
Monthly Payment = P × [r(1 + r)ⁿ] / [(1 + r)ⁿ - 1]
Total Interest = (Monthly Payment × n) - P
Where:
• P = Principal (Loan Amount)
• r = Monthly interest rate
• n = Number of monthly payments
Example Comparison:
Loan 1: $100,000 at 5% for 30 years
• Monthly payment: ~$537
• Total interest: ~$93,256
Loan 2: $100,000 at 4.5% for 30 years
• Monthly payment: ~$507
• Total interest: ~$82,406
• Loan 2 saves $30/month and $10,850 total
About Loan Comparison Calculator
A loan comparison calculator helps you compare two different loan options side-by-side to see which is better for your situation. When shopping for loans, you'll often receive multiple offers with different interest rates, terms, and monthly payments. This calculator shows you the monthly payment, total interest, and total cost for each loan, making it easy to see which loan saves you money. Use this to make informed decisions when choosing between loan options.
When to Use This Calculator
- Loan Shopping: Compare different loan offers
- Refinancing: Compare current loan vs. refinance option
- Term Comparison: Compare different loan terms (15 vs. 30 years)
- Rate Comparison: Compare different interest rates
Understanding Loan Comparison
- Monthly Payment: Lower payments may mean longer terms or higher rates
- Total Interest: Shows total cost of borrowing
- Total Cost: Principal plus all interest
- Trade-offs: Lower payment may mean higher total cost
Why Use Our Calculator?
- ✅ Side-by-Side: Compare two loans easily
- ✅ Complete Picture: See monthly payment and total cost
- ✅ Savings Analysis: See which loan saves money
- ✅ Decision Support: Make informed loan decisions
- ✅ 100% Free: No registration or payment required
Frequently Asked Questions
How do I choose between two loans?
Consider: (1) Can you afford the monthly payment? (2) Which has lower total cost? (3) What are your financial goals? (4) Are there fees or points? Generally, choose the loan with the lowest total cost that you can afford monthly. However, if you need lower payments, a longer term may be better even if total cost is higher.
Should I choose a lower monthly payment or lower total cost?
It depends on your situation. Choose lower total cost if: you can afford the payment, you want to save money long-term, and you plan to keep the loan for the full term. Choose lower payment if: you need cash flow, you may pay off early, or you can invest the difference at higher returns.
What other factors should I consider?
In addition to rate and term, consider: (1) Origination fees and points, (2) Prepayment penalties, (3) Closing costs, (4) Lender reputation and service, (5) Loan type (fixed vs. variable), (6) Your credit score impact. Factor in all costs, not just interest rate.
Is a lower interest rate always better?
Not always. A lower rate with points/fees may cost more than a slightly higher rate with no fees. Also, a lower rate with a longer term may have higher total cost than a higher rate with a shorter term. Always compare total costs, not just rates.