Finance
Loan payment calculator
Enter the amount, rate, and term to see the fixed monthly payment on a loan — plus the total you’ll repay and how much of it is interest.
- Monthly payment
- $396.02
- Total repaid
- $23,761.44
- Total interest
- $3,761.44
Assumes a fixed rate and equal monthly payments (a standard amortizing loan). Estimates only.
What drives the payment
Three things set your payment: how much you borrow, the interest rate, and how long you take to repay. Raising the rate or shortening the term pushes the monthly payment up; stretching the term pushes it down — but quietly adds interest, because you owe for longer.
A worked example
Borrow $20,000 at 7% over 5 years and the payment is about $396 a month. You repay roughly $23,760 in total, so about $3,760 is interest. Stretch the same loan to 7 years and the monthly payment falls — but the total interest climbs.
Learn the ideas
Understanding rates and total cost turns a payment into a decision. Work through the Finance subject, or see how balances grow with the compound interest calculator.
Frequently asked questions
- How is a monthly loan payment calculated?
- For a fixed-rate amortizing loan, payment = P × i ÷ (1 − (1 + i)^−n), where P is the amount borrowed, i is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments. Each payment covers that month’s interest first, with the rest reducing the balance.
- Why do I pay so much more than I borrowed?
- The gap is interest. Early payments are mostly interest because the balance is still large; only later do payments chip away mainly at principal. A longer term lowers the monthly payment but raises the total interest, sometimes dramatically.
- Does a lower monthly payment mean a cheaper loan?
- Not usually. A lower payment often just means a longer term, so you pay interest for more months and more in total. Compare loans by their interest rate and total repaid, not the monthly figure alone.
- Is this calculator free?
- Yes — no sign-up, and it runs entirely in your browser. Results are estimates for planning.