Is the interest rate entered monthly or annually?

Annually. The field is labelled Annual interest rate, and the tool converts it to a monthly rate by dividing by 12 before running the amortization math. Entering a monthly rate by mistake would understate the payment dramatically, so double-check the number you paste.

Why is interest higher in my first payment?

Interest is charged on the outstanding balance, which is largest at the start. Each payment covers that interest first and the rest reduces principal. The first payment panel shows a heavy interest share, and the last payment panel shows almost pure principal — the amortization curve in action.

Does the calculator include fees or insurance?

No. The calculation covers principal and interest only. Origination fees, credit insurance, and add-ons are not included, so your quoted payment may be higher. The tool's totals are the pure cost of the money itself, which makes comparing loan offers cleaner.

What happens when I set the rate to zero?

The amortization formula has a divide-by-zero edge case at r = 0, so the tool switches to a simple principal ÷ months payment instead. A 12,000 loan over 12 months returns 1,000 per month with zero total interest, exactly what a promotional interest-free plan should cost.

How accurate are the total interest figures?

They are exact for a fixed-rate loan with equal monthly payments and no extra fees, computed from the same formula lenders use. Small differences against a lender's schedule usually come from rounding, an odd first period, or date-based interest accrual, none of which this monthly model simulates.

Finance

Loan Calculator

Calculate monthly payments, total interest, and amortization.

loanpaymentinterestamortization

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About the Loan Calculator

The Loan Calculator estimates the monthly payment, total paid, and total interest on any fixed-rate installment loan, using the standard amortization formula M = P·r(1+r)ⁿ / ((1+r)ⁿ − 1), where r is the monthly rate and n the number of months. Enter a principal, an annual interest rate, and a term in years or months, and the three headline stats update immediately: Monthly payment, Total paid, and Total interest. Two extra panels break the first and last payments into principal and interest, so you can see how heavily interest dominates the start of a loan and how little remains at the end — the mechanics behind every amortization schedule. The term unit toggle makes it just as comfortable with a five-year auto loan as with an eighteen-month installment plan, and a zero-percent rate is handled gracefully by dividing the principal evenly across payments. Because the totals come from the same formula a lender uses, the tool is ideal for comparing offers, deciding between a 48-month and a 72-month term, or answering the simple question: how much interest will this actually cost me? Results are quoted in US dollars and the formula is printed on the page, so nothing about the calculation is hidden.

Hand-written guide

Examples

Input

Principal = 20000, Annual interest rate = 7.5, Term = 5 with Years selected

Output

Monthly payment $400.76 · Total paid $24,045.54 · Total interest $4,045.54

Note: r = 0.075 ÷ 12 = 0.00625, n = 60; M = 20000 × 0.00625 × 1.00625⁶⁰ ÷ (1.00625⁶⁰ − 1) = 400.76.

Input

Principal = 12000, Annual interest rate = 0, Term = 12 with Months selected

Output

Monthly payment $1,000.00 · Total interest $0.00

Note: At r = 0 the formula divides the principal evenly: 12000 ÷ 12 = 1000 per month, with zero interest.

Input

Principal = 30000, Annual interest rate = 6, Term = 36 with Months selected

Output

Monthly payment $912.66 · Total paid $32,855.69 · Total interest $2,855.69

Note: r = 0.005, n = 36; monthly payment 912.66 × 36 = 32,855.69, minus 30,000 principal leaves 2,855.69 interest.

How to use

1
Type the amount you plan to borrow into the Principal field.
2
Enter the lender's rate in the Annual interest rate field, as a percentage like 7.5.
3
Set the Term field and choose Years or Months with the toggle below it.
4
Read Monthly payment, Total paid, and Total interest — all three recalculate live.
5
Compare the First payment and Last payment panels to see how the interest share shrinks across the loan.

Common use cases

Comparing a 48-month versus 72-month auto loan before visiting a dealership.
Estimating the true cost of a personal loan before applying.
Planning student loan repayment amounts after graduation.
Seeing how much of a first payment is interest versus principal.
Checking an interest-free installment plan actually costs nothing beyond the principal.
Sanity-checking a lender's quoted monthly payment against the standard formula.

Best practices

Enter the rate as an annual percentage, not a monthly one — the tool divides by 12 internally.
Remember the quote excludes origination fees, insurance, and taxes; add those separately when budgeting.
Compare Total interest across terms, not just the monthly payment, to judge a loan's real cost.
Treat the first/last payment split as a model: real lenders may round differently or have odd first periods.
For a zero-interest plan, set the rate to 0 and confirm the payment equals principal divided by months.
Re-run the numbers after a rate quote changes — small rate differences move the totals more than they feel.

Tips

Switch the term to Months for short loans under two years — it reads more naturally.
The first and last payment boxes show you where your money goes at both ends of the loan.
Use Total interest as the headline when comparing two offers with similar monthly payments.
Extend the term and watch Total interest jump — that gap is the price of a smaller payment.

Frequently asked questions

It uses the standard amortization formula M = P·r(1+r)ⁿ / ((1+r)ⁿ − 1), with r the monthly rate (annual rate divided by 12) and n the number of months. The formula is printed on the page. A special case handles r = 0 by dividing the principal evenly across the term.

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