Everyday Tools
Simple Loan Payment Calculator
Enter a loan amount, rate, and term to get the monthly payment and the total interest paid over the life of the loan.
Calculation inputs
Works for any fixed-rate amortising loan — personal, auto, or student.
Results
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Complete the fields and select Calculate to show results here.
About this calculator
This calculator works out the fixed monthly payment on a loan, along with the total interest paid, based on the amount borrowed, the interest rate, and the repayment term. It suits personal loans, auto loans, and student loans with a standard fixed rate.
How the calculation works
- Monthly rate = annual rate ÷ 12 ÷ 100
- Payment = principal × rate ÷ (1 − (1 + rate)^−months)
- Total interest = (payment × months) − principal
Notes and assumptions
This covers principal and interest only — fees, insurance, and taxes are not included.
How it works in plain English
A fixed-rate loan is repaid in equal monthly installments over a set term, with each payment covering a mix of interest and principal. Early payments are weighted more toward interest because the outstanding balance is largest at the start, while later payments pay down more principal as the balance shrinks.
The calculator converts the annual interest rate into a monthly rate, then uses the standard amortization formula to solve for the fixed payment amount that will exactly pay off the loan, with interest, by the end of the term. Multiplying that payment by the number of months gives the total amount paid, and subtracting the original loan amount from that total gives the total interest cost.
Adding an extra monthly payment shortens the loan term and reduces total interest, because more of each payment goes toward principal, which then accrues less interest going forward. The calculator can estimate how many months it would take to pay off the loan early under a given extra payment amount, along with the resulting interest savings.
The formula
- Monthly rate = annual rate / 12 / 100
- Payment = principal x rate / (1 - (1 + rate)^-months)
- Total interest = (payment x months) - principal
Worked example
A $25,000 loan at 7.5% annual interest over 5 years (60 months) has a monthly rate of 7.5/12/100 = 0.00625. Plugging into the amortization formula gives a monthly payment of about $500.93. Over 60 months, total payments come to about $30,056, meaning total interest paid is roughly $5,056, or about 20% of the original loan amount. Adding $100 extra per month would speed up payoff to around 51 months and meaningfully cut the total interest paid. Under that extra-payment scenario, total payments drop to roughly $500.93 x 51 plus the final adjusted installment, landing around $25,600 to $25,700 all in, which trims total interest down to somewhere near $600 to $700 saved compared with the original 60-month schedule. Shaving 9 months off the term while saving that much interest illustrates why even a modest extra payment can meaningfully change the overall cost of a loan.
Frequently asked questions
Does this include taxes, insurance, or fees?
No. This calculator covers principal and interest only, which is the core of a fixed-rate loan payment. Auto and mortgage-style loans often carry additional costs like insurance, registration, or servicing fees, so your actual required payment could be higher than the figure shown here.
How does an extra monthly payment save on interest?
Extra payments go directly toward reducing the remaining principal balance, which means less of the loan is left to accrue interest in future months. Because interest is calculated on the outstanding balance, shrinking it faster both shortens the loan term and lowers the total interest paid over the life of the loan.
Why is more of my early payments going toward interest?
Interest is charged on the current outstanding balance, which is highest at the very start of the loan. As you pay down principal over time, the balance shrinks, so each subsequent payment accrues less interest and a larger share goes toward principal instead — a pattern called amortization.
What if my loan has a variable interest rate instead of fixed?
This calculator assumes a fixed rate for the entire term, so it will not accurately reflect a variable-rate loan whose rate can change periodically. For a variable-rate loan, treat the result as only a snapshot estimate based on the current rate, since actual payments could rise or fall later.
Can I use this for a loan that is already partway paid off?
Enter your current outstanding balance rather than the original loan amount, along with the remaining term and rate, to get an accurate payment and interest estimate for what's left. Using the original loan amount partway through would overstate both the payment and the remaining interest.