Money calculator
Loan Calculator
Find your monthly payment, total interest, and year-by-year amortization for any fixed-rate loan.
Monthly payment
$0.00
Amortization schedule
Principal and interest paid each year, with the balance remaining at the end of the year.
How loan payments are calculated
Most mortgages, auto loans, personal loans, and student loans are amortized. You make the same payment every month, and each payment covers that month's interest first, with the rest reducing the balance. Early payments are mostly interest; later payments are mostly principal.
Loan payment formula
M is the monthly payment, P is the loan amount, r is the monthly interest rate (annual rate ÷ 12 ÷ 100), and n is the total number of monthly payments. With a 0% interest rate, the payment is simply the loan amount divided by the number of months.
Example: $250,000 mortgage at 6.5% for 30 years
The monthly rate is 6.5% ÷ 12, or about 0.5417%, across 360 payments. The monthly payment comes to about $1,580.17. Over 30 years you would pay roughly $318,861 in interest, bringing the total cost of the loan to about $568,861.
How extra payments save money
Any amount you pay above the required payment goes straight to the principal. A smaller balance means less interest accrues the following month, so extra payments shorten the loan and reduce the total interest far more than their size suggests. Adding $200 a month to the mortgage above would pay it off almost 8 years early and save roughly $97,000 in interest.
What this calculator does not include
For a mortgage, your real monthly housing payment usually also includes property taxes, homeowners insurance, and sometimes mortgage insurance or HOA fees. For auto loans, sales tax and fees may be rolled into the amount borrowed. Enter the total amount financed to account for those.
Frequently asked questions
What is amortization?
Amortization is paying off a loan with fixed, regular payments that cover interest and gradually reduce the principal until the balance reaches zero.
Why is most of my early payment interest?
Interest is charged on the remaining balance. When the balance is largest, at the start of the loan, the interest portion of each payment is largest too. As the balance falls, more of each payment goes to principal.
Does a shorter term always cost less?
A shorter term means higher monthly payments but less total interest because the balance is paid down faster and the lender charges interest for fewer months.
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal. APR also includes certain lender fees, so it is a better measure of the loan's total cost. This calculator applies the rate you enter directly to the balance.
Can I use this for a car loan or personal loan?
Yes. Any fixed-rate loan with equal monthly payments uses the same formula. Enter the amount financed, the rate, and the term in months or years.
How the loan calculator works
Enter the amount you are borrowing, the annual interest rate (APR), and the term in years or months. The calculator converts the annual rate to a monthly rate, works out the fixed payment that clears the balance exactly at the end of the term, and then simulates the loan month by month to produce the totals. Terms of up to 100 years are accepted, and half-year terms such as 2.5 years are rounded to the nearest whole month.
The headline figure is the monthly payment. Beneath it you get the loan amount, the total interest you will pay, the total paid over the life of the loan, the number of payments, and the payoff time. An optional extra monthly payment field lets you see how paying more than required changes the picture: the required payment is shown separately, and a note reports how many months you save and how much interest you avoid.
Monthly payment formula
M is the monthly payment, P is the amount borrowed, r is the monthly interest rate as a decimal, and n is the number of monthly payments. When the rate is 0%, the formula is undefined, so the calculator simply divides the loan amount by the number of months.
Take a $30,000 auto loan at 7% APR over 5 years. The monthly rate is 0.07 ÷ 12 = 0.005833, and there are 60 payments, so (1 + r)^n = 1.005833^60 = 1.4176. The payment is 30,000 × 0.005833 × 1.4176 ÷ 0.4176 = $594.04. Over 60 payments you hand over $35,642.16, so the total interest is $5,642.16. In the first month, interest is 30,000 × 0.005833 = $175.00 and the remaining $419.04 of the payment reduces the balance. By the final month almost the whole payment is principal.
How the amortization schedule is built
Rather than relying on the closed-form formula alone, the calculator walks through the loan one month at a time. Each month it charges interest on the outstanding balance, subtracts that interest from the payment, and applies the remainder to principal. The results are grouped into years, and the schedule below the calculator shows, for each year, how much went to principal, how much went to interest, and the balance left at the end of the year. Up to 50 years of the schedule are displayed.
Because the schedule is simulated, it reflects real behavior that a single formula misses. The final payment is trimmed so the balance never goes below zero, and extra payments are applied to principal immediately, which changes the interest charged in every following month.
What extra payments do
Any amount you pay above the required payment goes entirely to principal. Because next month's interest is calculated on a smaller balance, every extra dollar also reduces the interest on all the months that follow. On the $30,000 auto loan above, adding $100 a month pays the loan off in 50 months instead of 60 and cuts total interest from $5,642.16 to $4,669.83, a saving of $972.33 for $5,000 of earlier payments.
The effect scales with the size and length of the loan. On a 30-year mortgage, a modest extra payment can remove several years from the term and save tens of thousands of dollars. Before committing to extra payments, confirm with your lender that there is no prepayment penalty and that additional amounts are applied to principal rather than held as a credit against future payments.
When to use this calculator and what it leaves out
The tool models any fixed-rate loan with equal monthly payments, which covers most mortgages, auto loans, personal loans, and federal student loans. Use it to compare lenders, test a shorter term, or decide how much to put down. Keep the following limitations in mind:
- Mortgage results cover principal and interest only; property taxes, homeowners insurance, mortgage insurance, and HOA dues are not included
- The rate you enter is applied to the balance directly, so lender fees and closing costs that are part of a quoted APR are not modeled
- Adjustable-rate, interest-only, and balloon loans do not follow a fixed amortization schedule
- Interest is compounded monthly; some lenders accrue daily, which produces small differences of a few cents per month
- For auto loans, enter the amount financed after your down payment and trade-in, including any taxes and fees rolled into the loan
Frequently asked questions
What is the monthly payment on a $30,000 loan at 7% for 5 years?
The payment is $594.04 per month. Over 60 payments you pay $35,642.16 in total, of which $5,642.16 is interest.
How do I calculate a loan payment by hand?
Divide the annual rate by 12 to get the monthly rate r, then use M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where P is the loan amount and n is the number of months. A scientific calculator or spreadsheet PMT function does the exponent for you.
Does paying extra each month lower my monthly payment?
No. On a standard amortized loan the required payment stays the same; extra payments shorten the term and reduce total interest instead. Lowering the payment itself requires refinancing or a formal recast.
How much interest do I pay in the first year?
More than in any later year, because interest is charged on the full balance. On a $30,000 loan at 7% over 5 years, about $1,935 of the first year's $7,128 in payments is interest. The amortization schedule shows the exact split for every year.
What happens if I enter a 0% interest rate?
The calculator divides the loan amount evenly across the number of months. A $12,000 loan over 24 months at 0% costs $500 a month with no interest.
Is the loan term in years or months?
Either. Use the dropdown beside the term to switch. Years are converted to months by multiplying by 12, so a 30-year mortgage has 360 payments and a 72-month auto loan is 6 years.
This calculator is for informational and educational purposes only and is not financial advice. Its results are estimates that may not reflect actual rates, fees, taxes, or terms you are offered. Talk to a qualified financial professional before making financial decisions.