Loan Calculator

Calculate your monthly loan payment, total interest, and total repayment instantly. Enter the loan amount, annual interest rate, and term to see a full amortization breakdown with this free loan calculator.

Enter the loan amount

Repayment Method

How to Use

  1. Enter loan details

    Input the loan amount, annual interest rate (%), and loan term (years).

  2. Choose repayment type

    Select fixed-payment (amortization) or fixed-principal repayment method.

  3. View results

    See monthly payment, total interest, and full amortization schedule.

What is loan repayment?

Loan repayment is the process of paying back the borrowed principal plus interest in installments over an agreed term. The two most common structures are the equal-payment (amortizing) method, where you pay the same amount every month, and the equal-principal method, where the principal is split evenly and interest is charged on the shrinking balance.

The real difference between the two

  • Equal payment: the monthly amount stays constant, which makes budgeting easy, but interest dominates the early payments, so you pay more total interest.
  • Equal principal: early payments are higher but shrink over time, and the total interest is lower, which is an advantage on long-term loans.

Use it to estimate the monthly burden of a mortgage or personal loan ahead of time and to judge whether it fits comfortably within your budget.

Calculation Formula

Monthly payment formula for the equal-payment (amortizing) method:

M = P × r × (1+r)^n / [(1+r)^n − 1]

P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payment months. For example, borrowing 100,000 (P) at 5% per year (monthly r = 0.004167) over 30 years (n = 360) gives a monthly payment of about 536.82 and total interest of about 93,255.

The equal-principal method adds the fixed principal P÷n to the interest on the remaining balance (remaining principal × r) each month. The first month is 277.78 + 416.67 = about 694.44, but it falls every month, so the total interest is lower, at about 75,210.

Frequently Asked Questions

What is the difference between the equal-payment and equal-principal methods?
With the equal-payment method you pay the same amount every month, which makes planning easy but results in higher total interest. With the equal-principal method you repay the same principal each month, so early payments are larger but total interest is lower.
How is loan interest calculated?
Loan interest is calculated by multiplying the remaining principal by the monthly interest rate (annual rate ÷ 12). For the equal-payment method, the monthly payment is found with M = P × r(1+r)^n / [(1+r)^n − 1], and each month is then split into interest and principal portions.
What changes if I extend the loan term?
Extending the term lowers the monthly payment, but because interest accrues for longer, the total interest rises sharply. For a 100,000 loan at 5% per year, a 20-year term yields about 58,400 in total interest, while a 30-year term raises it to about 93,255.
Which is better, a fixed or a variable rate?
A variable rate is favorable when rates are falling, and a fixed rate when they are rising. This calculator works from the fixed rate you enter, so for a variable-rate loan use the current rate to estimate the expected payment.
How do prepayment penalties work?
Prepayment penalties vary by lender, but they typically charge 1 to 1.5 percent of the remaining principal if you repay within the first 3 years of the loan and waive the fee after that. This calculator only computes the normal repayment schedule.
How is the loan limit determined?
Under the debt-service-ratio (DSR) rule, the annual principal-and-interest payments on all your loans cannot exceed 40 percent (banks) or 50 percent (secondary lenders) of your annual income. Mortgages are also subject to LTV and DTI limits.
What happens with a grace period?
During a grace period you pay only interest and no principal, so the monthly burden is lower, but the principal stays unchanged, so payments jump once the grace period ends and total interest rises. This calculator assumes principal repayment with no grace period.
Updated 2026 — latest rates

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