How this loan calculator works
This is a general-purpose amortization calculator. It works for any fixed-rate, fully-amortizing loan: one where you make equal monthly payments until the balance reaches zero. That covers the vast majority of mortgages, auto loans, personal loans, and student loans.
Enter three numbers: your loan amount, annual interest rate, and term in months. The calculator immediately shows your monthly payment, total interest, and total amount paid. Expand the schedule to see the complete month-by-month breakdown.
For product-specific defaults and content, use the dedicated calculators: the mortgage calculator is pre-filled for home loans, the auto loan calculator uses car-loan defaults, and the student loan calculator covers fixed-rate education loans.
Why total interest is higher than you expect
First-time borrowers are often surprised by the total interest figure. On a $300,000 mortgage at 6% for 30 years, you pay $347,515 in interest alone — more than the original loan. Even a $20,000 personal loan at 7% for 5 years costs approximately $3,761 in total interest.
This is not a calculation error — it is the mathematical cost of borrowing over time. Interest compounds: each month, the lender charges a percentage of your outstanding balance. The longer the term and the higher the rate, the more periods accumulate that charge.
The amortization schedule below the calculator shows exactly how this builds up month by month. It is the most honest representation of what a loan actually costs — more informative than the APR alone.
Using the five calculation modes
The tabs at the top of the calculator select different analysis modes:
- Standard amortization — your regular monthly payment and full schedule. The starting point for any loan.
- Payoff accelerator — add extra monthly payments or a lump sum and see how much faster you pay off and how much interest you save.
- Refinance comparison — compare your current rate and remaining term against a new offer, including closing costs and break-even month.
- Term comparison — side-by-side payment and interest for two different loan terms on the same balance and rate.
- Interest-only — model the interest-only phase of a loan before it converts to full amortization.
Frequently asked questions
How do I calculate a loan payment?
For any fixed-rate loan: monthly payment = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments. On a $20,000 loan at 7% for 60 months, the monthly rate is 0.5833%, giving a payment of approximately $396/month. The calculator above runs this formula for any loan amount, rate, and term.
What is a loan amortization schedule?
An amortization schedule is a complete month-by-month table showing how each payment splits between interest and principal, and what your remaining balance is after each payment. It shows exactly when you'll be halfway through your loan (in terms of balance, not payments — always later than you expect) and when each dollar of your payment starts going mostly to principal instead of interest.
How does amortization work?
Amortization means spreading loan repayments across a fixed term so each payment is equal. Interest is charged on the outstanding balance — so in month one, most of your payment goes to interest. As the balance falls, the interest portion shrinks and the principal portion grows. By the final payment, almost all of it is principal. This is why paying extra early has such an outsized effect: each extra dollar eliminates the compounding interest it would have generated for all remaining periods.
What is the total interest on a loan?
Total interest = (monthly payment × number of payments) − original loan amount. On a $20,000 / 7% / 60-month loan, total interest is approximately $3,761 — about 18.8% of the original loan. On a longer-term mortgage at the same rate, the ratio is much higher because more periods accumulate interest. The calculator displays total interest alongside your monthly payment.
Can I use this calculator for any type of loan?
Yes. This calculator works for any fixed-rate amortizing loan: mortgages, auto loans, personal loans, student loans, home equity loans, business loans, or any other loan where you make equal monthly payments over a fixed term. It does not cover variable-rate loans (where the rate changes during the term), interest-only loans (use the Interest-Only mode), or income-driven student loan repayment plans.
What this calculator computes — and what it does not
This calculator models fixed-rate, fully amortizing loans using the standard amortization formula. A number of real-world factors are outside its scope.
- 1.Results are estimates, not guarantees. Actual loan costs depend on the exact terms in your loan agreement, any fees charged at origination, how the lender applies payments, and whether you make every payment exactly on schedule. This calculator assumes all payments are made on time with no changes.
- 2.Interest rates are user-supplied, not live market data. This tool does not connect to any rate feed. The rate you enter should come from a lender quote or your loan agreement. Current rates vary by lender, credit score, loan type, and market conditions — this calculator cannot provide those figures.
- 3.Property taxes, insurance, and PMI are excluded unless toggled on. The payment computed here is principal and interest only. For a mortgage, your total monthly obligation includes property taxes, homeowners insurance, and PMI (if your down payment is under 20%) — collected in escrow by most lenders. These can add $200–$800 or more per month to the P&I payment shown.
- 4.APR vs. interest rate. This calculator uses the stated interest rate for payment math. APR (Annual Percentage Rate) is always higher than the interest rate because it spreads lender fees over the loan term. APR is the correct metric for comparing loan costs across lenders; the stated rate is the correct input for computing the payment schedule.
- 5.Variable-rate loans cannot be accurately projected. This calculator models fixed-rate amortization only. For adjustable-rate mortgages (ARMs), tracker mortgages, or variable-rate personal loans, the payment changes when the rate resets — the full-term projection would require assumptions about future rates that cannot be known in advance.
This calculator is for educational and planning purposes only. It does not constitute financial, mortgage, or legal advice.