About This Calculator
This calculator uses the standard amortizing loan formula: monthly payment = P × [r(1+r)ⁿ] / [(1+r)ⁿ – 1], where P is the principal, r is the monthly rate, and n is the number of payments.
Common loan types
- Auto loan: Typically 36–72 months at 5–10% APR
- Personal loan: Typically 12–60 months at 6–36% APR
- Mortgage: Typically 180 or 360 months (15 or 30 years) at 5–8% APR
Reducing interest paid
Making extra principal payments early in the loan dramatically reduces total interest, since interest is calculated on the remaining balance.
Frequently asked questions
How does this loan calculator work?
The loan calculator uses the standard amortization formula to turn your loan amount, interest rate, and term into a fixed monthly payment, plus the total interest and total cost over the life of the loan.
How is a monthly loan payment calculated?
It uses M = 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. The tool handles the math for you.
Does this work for car, personal, and home loans?
Yes — any fixed-rate, fixed-term amortizing loan. Enter the amount, APR, and term in months or years to see the monthly payment and total interest you will pay.