Loan Calculator
Calculate the monthly payment, total interest, and payoff schedule for any fixed-rate installment loan.
About the Loan Calculator
Whether it is a personal loan, a debt-consolidation loan, or financing for equipment, most fixed loans are repaid the same way: equal monthly installments that blend interest and principal until the balance reaches zero. This general-purpose loan calculator works for any amount, rate, and term, producing a monthly payment figure, total interest cost, and a schedule you can compare across offers.
How It Works
Enter the amount you are borrowing, the annual interest rate the lender quotes, and how many years you will take to repay it. The calculator converts the annual rate into a monthly rate and applies the amortization formula used by virtually every fixed-rate lender to compute a payment that fully retires the loan by the final month, then totals the interest paid across every scheduled payment.
Payment = P × [r(1+r)^n] / [(1+r)^n − 1], where P is principal, r is the monthly rate, and n is the total number of payments.
Worked example
Scenario: Borrowing $20,000 at 8% a year, repaid monthly over 5 years.
- Monthly rate: 8% ÷ 12 = 0.6667%; payments: 5 × 12 = 60.
- Payment = 20,000 × 0.006667 ÷ (1 − 1.006667^−60) = $405.53.
- First month: $133.33 interest and $272.20 principal; the interest share falls every month after.
- Total repaid: $405.53 × 60 ≈ $24,332, so total interest is about $4,332.
Result: $405.53 a month for 60 months, with roughly $4,332 of interest.
How to compare loan offers
Compare loans using more than the monthly payment. A lower payment can come from a longer term, which may increase total interest substantially. Keep the amount and term consistent when comparing rates, and check lender fees separately because they may not be included in the payment formula.
Tips and common mistakes
- Enter the lender's quoted interest rate here; if they quote an APR that already includes fees, the payment shown will be slightly high.
- Fractional terms are allowed (for example 2.5 years), but lenders normally offer whole-month terms, so round to what you'll actually sign.
- If a fee is deducted from the amount you receive, use the APR Calculator to see the real cost of borrowing.
Assumptions & Limitations
- Assumes a fixed rate and equal monthly payments with no missed or late payments.
- Interest compounds monthly, the convention used by most installment lenders.
- Does not include origination fees, prepayment penalties, or variable-rate adjustments.
- Real lender quotes may round the payment slightly differently than this estimate.
Sources and review
Method: Standard fixed-rate amortization (level-payment annuity) formula with monthly compounding, the method used for installment loans and mortgages.
Sources:
- Consumer Financial Protection Bureau (CFPB) consumer guidance on loan payments, interest and amortization.
Last reviewed: October 2026 by Faheem Ali, founder of CalculatorAnything. The method and examples are provided for transparency; results remain estimates and may contain errors.
Results are estimates for planning and comparison, not financial advice or a lender's quote. Rates, fees, tax rules and regulations vary by country and change over time; confirm figures with your lender or a licensed adviser. Spotted an error? Tell us — see our editorial policy for how corrections are handled.