Loan Calculator
Use our free Loan Calculator to estimate your monthly payment, total interest, and payoff schedule for any loan. Whether you're financing a car, taking out a personal loan, or securing a home mortgage, this tool helps you understand the true cost of borrowing.
How Does a Loan Calculator Work?
A loan calculator uses a standard amortization formula to compute the fixed monthly payment required to pay off a loan in full. You simply input the loan amount (principal), the annual interest rate (APR), and the loan term (in months or years), and the tool returns a monthly payment amount and a breakdown of total interest over the life of the loan.
Many calculators also display an amortization schedule, which shows how much of each payment goes toward interest and principal. Early payments tend to be interest-heavy, but over time, more of your payment is applied to the loan balance.
Loan Calculator Formula
The basic formula used to calculate monthly loan payments is:
M = P × (r × (1 + r)^n) / ((1 + r)^n – 1)
Where:
- M = Monthly payment
- P = Loan amount (principal)
- r = Monthly interest rate (annual rate ÷ 12 ÷ 100)
- n = Total number of payments (loan term in months)
Types of Loans You Can Calculate
Our Loan Calculator works with many types of fixed-rate loans, including:
- Auto Loans: Calculate your monthly car payment based on down payment, term length, and APR.
- Personal Loans: Estimate payments for unsecured loans, often used for debt consolidation or large purchases.
- Home Mortgages: Simulate fixed-rate mortgage payments and explore different loan terms (15, 20, 30 years).
- Student Loans: Plan for repayment on education loans with or without a grace period.
- Small Business Loans: Forecast debt servicing costs for capital equipment or operational loans.
Why Use a Loan Calculator?
- Compare loan offers: See the difference between loans with varying interest rates and terms.
- Understand total cost: Know how much interest you'll pay over time, not just the monthly amount.
- Create a budget: Factor loan payments into your monthly spending plan and avoid surprises.
- Make smarter decisions: See how increasing your down payment or reducing the loan term affects your cost.
Tips to Reduce Loan Costs
- Shop for better rates: Compare lenders — even a 1% difference in APR can save thousands.
- Make extra payments: Apply extra funds directly to the principal to shorten the term and reduce interest.
- Refinance wisely: Consider refinancing if rates drop or your credit improves.
- Choose a shorter term: A 15-year loan may have higher monthly payments but less interest overall than a 30-year loan.
Amortization Explained
Amortization is the process of spreading loan payments over time. Early payments primarily cover interest, but over time, a larger portion of each payment is applied to the loan balance.
Many loan calculators generate an amortization schedule — a month-by-month breakdown showing:
- Payment amount
- Principal paid
- Interest paid
- Remaining balance
Reviewing this schedule helps you visualize how long it takes to repay your loan and when the majority of interest is paid.
FAQs
A: No — this calculator is designed for fixed-rate loans only. For variable or adjustable-rate loans, results may not reflect future changes.
A: Yes! It's completely free and requires no registration or login. All calculations are done instantly in your browser.
A: Currently, you can screenshot or print the page. Future updates will include PDF export and print-friendly views.
A: Not yet. The calculator shows loan principal and interest only. For full mortgage estimates, consider taxes and insurance separately.
Get Started
Ready to take control of your loan planning? Use this calculator to explore different payment strategies, compare loan offers, and make confident financial decisions. Whether you’re applying for a loan or already paying one off, a clear understanding of your numbers makes all the difference.