How much you'll pay each month
Enter the amount, the annual interest rate and the term, and you get the monthly payment, total interest and total paid. It uses the fixed-payment method (French system): you pay the same every month, but at first most of it is interest and over time more goes to principal. Example: 20,000 at 12% a year over 36 months gives a payment of about 664 and about 3,914 in total interest.
Nominal rate or effective rate
Banks quote either a nominal annual rate (APR) or an effective annual rate (APY). Choose the one in your offer: with nominal, the monthly rate is the annual rate divided by 12; with effective, the monthly rate is the twelfth root of (1 + rate) minus 1. With 100,000 at 8% nominal over 20 years the payment is around 836.
Extra payments and the amortization schedule
If you add an extra amount each month it goes to principal and shortens the term: in the example above, 100 more a month cuts the loan from 36 to 31 months and the interest to about 3,304. You can see the full schedule month by month and download it as CSV.
The result is an estimate: it doesn't include fees, insurance or origination costs. To simulate savings and investment, see Compound Interest.
Frequently Asked Questions
How is a loan payment calculated?
With the fixed-payment formula: payment = amount × i ÷ (1 − (1 + i)^−n), where i is the monthly rate and n the number of months.
What's the difference between a nominal and an effective rate?
The effective rate already includes the effect of compounding during the year; the nominal is divided by 12 to get the monthly rate. Choose what your lender quotes.
What happens if I make extra payments?
They come off the outstanding principal, so you finish sooner and pay less interest. See the actual term in the result.
Does the result include fees or insurance?
No. It's an estimate of principal and interest; ask your lender for the total cost including fees.