Loan Calculator
Calculate your monthly loan payments, total interest, and view a detailed amortization schedule. Works for mortgages, auto loans, and personal loans.
How to Use This Loan Calculator
Our free online loan calculator helps you estimate your monthly loan payments and understand the total cost of borrowing. Whether you are planning a mortgage, an auto loan, or a personal loan, this tool gives you the information you need to make informed financial decisions.
Step-by-Step Instructions
- Enter the loan amount -- the total amount you plan to borrow.
- Enter the annual interest rate -- the yearly percentage rate charged by the lender.
- Enter the loan term -- choose years or months depending on your loan type.
- Click "Calculate" to see your monthly payment, total payment, total interest, and full amortization schedule.
Understanding the Results
The monthly payment is the fixed amount you pay each month. The total payment is the sum of all payments over the life of the loan. The total interest shows how much you pay in interest above the principal. The amortization schedule breaks down each monthly payment into principal and interest portions, showing your remaining balance over time.
Loan Payment Formula
This calculator uses the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n - 1], where M is the monthly payment, P is the principal, r is the monthly interest rate, and n is the total number of payments.
Frequently Asked Questions
How is the monthly loan payment calculated?
The monthly payment is calculated using the standard loan amortization formula. It takes into account the loan principal, the annual interest rate (converted to a monthly rate), and the total number of monthly payments. Each payment consists of both principal and interest portions.
What is an amortization schedule?
An amortization schedule is a table that shows the breakdown of each loan payment over time. It displays how much of each payment goes toward the principal versus interest, and the remaining loan balance after each payment. Early payments typically have a higher interest portion, while later payments have a higher principal portion.
Can I use this for mortgage calculations?
Yes, this loan calculator works perfectly for mortgage calculations. Enter your mortgage amount, interest rate, and term (typically 15 or 30 years) to see your estimated monthly mortgage payment and total cost over the life of the loan.
Does this calculator include taxes and insurance?
This calculator shows principal and interest only. Your actual monthly payment for a mortgage may be higher when including property taxes, homeowner's insurance, and private mortgage insurance (PMI). These vary by location and lender.
How can I reduce my total interest paid?
You can reduce your total interest by choosing a shorter loan term, making a larger down payment to reduce the principal, shopping for a lower interest rate, or making extra payments toward the principal. Even small additional monthly payments can significantly reduce total interest over the life of the loan.