💰 Loan Payment Calculator
Calculate loan payments
How to Use This Calculator
Enter Loan Amount
Input the principal loan amount - the amount you're borrowing.
Enter Interest Rate
Enter the annual interest rate as a percentage. This is the cost of borrowing money.
Enter Loan Term
Enter the loan term in years (e.g., 30 for a 30-year mortgage, 5 for a 5-year auto loan).
Review Payment Results
See your monthly payment, total interest paid, and total amount paid over the life of the loan.
Formula
Monthly Payment = P × [r(1 + r)ⁿ] / [(1 + r)ⁿ - 1]
Where:
• P = Principal (Loan Amount)
• r = Monthly interest rate (Annual Rate ÷ 12)
• n = Number of monthly payments (Years × 12)
Example Calculation:
If loan amount $10,000, interest rate 6%, term 5 years:
• Monthly rate = 6% ÷ 12 = 0.5%
• Number of payments = 5 × 12 = 60
• Monthly payment: ~$193
• Total interest: ~$1,580
About Loan Payment Calculator
A loan payment calculator helps you calculate your monthly loan payment, total interest paid, and total amount paid over the life of a loan. Whether you're planning to take out a mortgage, auto loan, personal loan, or any other type of loan, this calculator shows you the monthly payment amount and total costs. Understanding your loan payment helps you budget, compare loan options, and make informed borrowing decisions.
When to Use This Calculator
- Loan Planning: Plan for loans before applying
- Payment Planning: Understand monthly payment requirements
- Budget Planning: Plan your budget around loan payments
- Loan Comparison: Compare different loan options
- Affordability: Determine if you can afford a loan
Understanding Loan Payments
- Amortization: Loans are typically amortized (fixed payment over term)
- Principal & Interest: Each payment includes principal and interest
- Early Payments: Early payments are mostly interest, later payments mostly principal
- Total Interest: Total interest depends on rate, term, and amount
Why Use Our Calculator?
- ✅ Quick Calculation: Instantly see monthly payment and total cost
- ✅ Accurate Formula: Uses standard loan amortization formula
- ✅ Payment Planning: Plan your budget around loan payments
- ✅ Interest Analysis: Understand total interest costs
- ✅ 100% Free: No registration or payment required
Frequently Asked Questions
How is the monthly payment calculated?
The monthly payment is calculated using the standard loan amortization formula: Monthly Payment = P × [r(1 + r)ⁿ] / [(1 + r)ⁿ - 1], where P is the principal, r is the monthly interest rate, and n is the number of payments. This ensures the loan is paid off in full by the end of the term.
Why do I pay so much interest?
Total interest depends on the loan amount, interest rate, and loan term. Longer terms and higher rates result in more total interest. Early in the loan, most of your payment goes toward interest, while later payments go mostly toward principal. This is how amortization works.
How can I reduce my monthly payment?
To reduce monthly payments: (1) Choose a longer loan term (though this increases total interest), (2) Get a lower interest rate (improve credit, shop around), (3) Make a larger down payment to reduce loan amount, (4) Consider refinancing. Remember: lower payments often mean more total interest over time.
Does this calculator work for all loan types?
Yes, this calculator works for any fixed-rate, amortized loan including mortgages, auto loans, personal loans, student loans, and more. It doesn't work for interest-only loans, adjustable-rate loans (unless you enter the current rate), or loans with balloon payments.