Monthly payment and total interest for any fixed rate loan. Results update as you type.
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Results are estimates for education only and are not financial advice.
For a fixed rate loan, the payment is set so the loan is fully paid off by the end of the term. Each payment covers that month's interest first, and the rest reduces principal. That is why early payments are mostly interest and later payments are mostly principal.
M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1). Here M is the monthly payment, P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments (loan term in years × 12).
A $25,000 loan at 6.5% annual interest over 5 years (60 payments) gives a monthly payment of $489.15. The total of all payments is $29,349.22, so total interest is $4,349.22.
Yes, and often more. A lump sum goes straight to principal, which lowers the balance that future interest is charged on, so the loan ends sooner and total interest drops. Ask your lender to apply it as a principal-only payment and check your next statement to confirm.
No. The interest rate is what the calculator uses to work out your payment, while the APR is a broader yearly cost that also folds in lender fees and charges. Two loans with the same rate can have different APRs, so compare APRs when you compare offers.
Use this calculator for any fixed rate loan that is paid off in equal monthly payments: a personal loan, an auto loan, or a home improvement loan. Enter the amount, the annual rate, and the term. The result shows the monthly payment and the total interest, which are the two numbers that matter when you compare offers. Two loans with the same monthly payment can carry very different total interest once the term changes, so always compare both numbers before you sign.
The payment follows the standard amortization formula, where each payment covers that month's interest first and the rest reduces the balance. Take a $20,000 loan at 8 percent over 4 years (48 payments). The monthly payment is $488.26 and total interest is $3,436.41, for total payments of $23,436.41. The first payment splits into $133.33 of interest and $354.93 of principal. The last payment flips to $3.23 of interest and $485.02 of principal. That shift is normal amortization: interest is charged on a shrinking balance, so the principal slice grows every month even though the payment never changes.
Not every loan amortizes this way, and the difference is expensive. Some dealer or short term loans charge flat interest on the original balance for the whole term. On the same $20,000 at 8 percent over 4 years, flat interest is $20,000 times 8 percent times 4 years, which is $6,400, and the monthly payment is $550.00. That is $2,963.59 more interest than the amortizing loan at the same rate. Before you sign, ask whether interest is charged on the declining balance or on the original amount. Also compare the APR, not just the rate: the APR folds lender fees and charges into one yearly cost, so two loans with the same rate can have different APRs.
Three mistakes show up again and again. First, buyers pick the lowest monthly payment without checking the term. Stretching a loan lowers the payment but adds years of interest. Second, buyers compare rates and ignore fees. A slightly higher rate with no fees can beat a lower rate loaded with charges, which is exactly what the APR reveals. Third, buyers borrow up to the maximum payment they can afford and leave no buffer. A payment that fits only when nothing goes wrong becomes a problem at the first surprise bill. Choose the shortest term whose payment still leaves room for emergencies, and direct any extra money to principal, where it cuts all future interest.
Only if you need the lower payment to stay afloat. A longer term always costs more total interest, because you pay interest for more years. Pick the shortest term whose payment fits your budget comfortably, and use extra payments to shorten it further when money is good.
Early, by a wide margin. Early payments are mostly interest, so an extra dollar to principal removes a balance that would have generated interest for the longest remaining time. The same extra dollar paid in the final year only removes a few months of interest. If you can only make one extra payment, make it early.
No. It assumes one fixed rate for the whole term. On a variable rate loan the payment changes whenever the rate changes, so treat the result as a snapshot at the current rate. Re-run the numbers at a higher rate to see what your payment could become.
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