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Loan Payment Calculator

%
years

Monthly Payment

$401

Total Interest

$4,046

Total Paid

$24,046

Monthly payment stays fixed, but interest cost depends heavily on rate and term. Extra payments (if allowed) can reduce total interest.

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After you get your result, compare a few scenarios or explore related tools.

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How it works

Most fixed-rate loans (car loans, personal loans, many student loans) use amortization: you make the same payment each month, but the split between interest and principal changes over time. Early payments tend to be interest-heavy; later payments pay down principal faster.

  1. Enter loan amount, APR, and term.
  2. The calculator converts APR to a monthly rate.
  3. It estimates a fixed monthly payment plus interest.

Use this to compare options: different terms, different rates, or different loan amounts. The total interest output is often what surprises people, especially on longer terms.

Formula

Payment = P·r / (1 − (1+r)^(-n))

Where P is principal, r is the monthly interest rate (APR ÷ 12), and n is the number of monthly payments.

Example

$20,000 at 7.5% for 5 years → monthly payment ≈ $401

How to interpret your result

Focus on two outputs:

  • Monthly payment determines affordability.
  • Total interest tells you how expensive the loan is over time.

If total interest is a large share of total paid, compare a shorter term or a lower rate. Even small rate reductions can materially reduce total interest on longer terms.

Common mistakes

  • Using the loan amount after fees (or before down payment) incorrectly.
  • Forgetting that taxes/registration/insurance can add to real monthly cost (especially for car loans).
  • Assuming a longer term is “cheaper” because the payment is lower (it can cost more in total interest).
  • Ignoring that APR vs interest rate can differ if fees are included.

Comparison table

ChoiceMonthly paymentTotal interest
Longer termLowerHigher (more months of interest)
Shorter termHigherLower (fewer months of interest)

FAQ

Fixed-rate loans use an amortization formula based on principal, interest rate, and term. Payments stay the same each month.

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