Total Interest
$4,701.80
Loan Calculator
Calculate payment, total interest and amortization for any loan.
Payment per Period
$495.03
Total Paid
$29,701.80
Payoff Time
5.0 yrs
Number of Payments
60
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | $4,327.45 | $1,612.91 | $20,672.55 |
| 2 | $4,640.28 | $1,300.08 | $16,032.27 |
| 3 | $4,975.73 | $964.63 | $11,056.54 |
| 4 | $5,335.42 | $604.94 | $5,721.12 |
| 5 | $5,721.12 | $219.24 | $0.00 |
What is the Loan Calculator?
A loan calculator turns a loan's three defining numbers — the amount you borrow (the principal), the annual interest rate, and the term — into the fixed periodic payment that clears it, plus the total interest you'll pay along the way. The same math drives any fully amortizing installment loan, so personal loans, student loans, car loans and mortgages all run through this one formula.
The formula
Each payment is the level amount that pays the loan to exactly zero over its term (the standard amortization formula):
M = P · r(1 + r)ⁿ ÷ ((1 + r)ⁿ − 1)- M
- payment per period
- P
- principal — the amount borrowed
- r
- periodic interest rate = annual rate ÷ payments per year
- n
- total number of payments = years × payments per year
When the rate is 0%, this collapses to simply P ÷ n.
Worked example
Borrow $25,000 at 7% annual interest over 5 years, paid monthly. Here r = 0.07 ÷ 12 and n = 60.
The monthly payment works out to $495.03. Across all 60 payments you repay $29,701.80, of which $4,701.80 is interest.
Prefer your own numbers? Enter them in the calculator above — it recomputes instantly.
Key terms
- Principal
- The amount you originally borrow, before any interest.
- Term
- How long you have to repay the loan, usually in years or months.
- Amortization
- Paying a loan off in equal installments, each part interest and part principal.
- Total interest
- The sum of every interest charge over the life of the loan — the true cost of borrowing.
Frequently asked questions
Does a shorter term save money?
Yes. A shorter term raises the monthly payment but sharply cuts total interest, because you're borrowing the money for less time.
What's the difference between the interest rate and the APR?
The interest rate prices the loan itself; the APR also folds in fees to show the true annual cost. Compare offers by APR, not headline rate.
Do extra payments help?
A lot. Every extra dollar goes straight to principal, shrinking the balance that future interest is charged on. The Loan Analysis calculator shows the effect.