Loan Calculator – Monthly Payment & Total Interest
Calculate monthly loan payments and total interest for personal loans, auto loans, and student loans. Supports all major currencies.
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How Loan Amortization Works
An amortizing loan spreads equal monthly payments across the entire loan term. Each payment covers the interest accrued since the last payment, with the remainder reducing the principal. As the principal decreases, less of each payment goes to interest and more to principal.
APR vs Interest Rate
The interest rate is the base borrowing cost. APR (Annual Percentage Rate) includes fees and other costs, making it the true cost of borrowing. Always compare APR when shopping for loans. A 5% rate loan with high fees may cost more than a 5.5% rate loan with no fees.
Impact of Loan Term on Total Cost
A longer loan term lowers monthly payments but dramatically increases total interest paid. A $10,000 loan at 7% for 3 years: $309/month, $1,116 total interest. The same loan for 6 years: $166/month, $2,952 total interest. The 6-year loan costs 165% more in interest despite halving the monthly payment.