What Is a Loan Calculator?

A loan calculator helps you determine your monthly payment for any installment loan — including personal loans, auto loans, and student loans. Enter the loan amount, interest rate, and repayment term to instantly see your monthly payment and total interest cost.

How to Use This Calculator

Enter the total loan amount you need to borrow.
Enter the annual interest rate (APR) offered by your lender.
Enter the loan term in months (e.g., 60 months = 5 years).
Click Calculate Loan to see your monthly payment and total interest.

Understanding Total Loan Cost

The total cost of a loan is much more than the amount you borrow. A $15,000 personal loan at 9% APR over 5 years costs approximately $3,600 in interest on top of the principal. This calculator helps you compare offers and understand the true cost before you commit.

Tips for Lowering Your Loan Cost

Improve your credit score before applying — better scores unlock significantly lower rates.
Choose a shorter loan term to pay less total interest.
Make extra payments when possible — they reduce principal faster and cut interest costs.
Always compare APRs, not just the interest rate or monthly payment.

How Is the Loan Payment Calculated?

M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1]

Variable Definitions

Monthly payment

Loan principal amount

Monthly interest rate (APR ÷ 12 ÷ 100)

Total number of monthly payments

💡 The same amortization formula applies to personal loans, auto loans, and student loans.

Frequently Asked Questions — Loan Calculator

What is APR and how does it differ from the interest rate?

The interest rate is the base cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus all fees and costs associated with the loan, expressed as a yearly rate. APR gives you a more complete picture of the true cost of a loan. Always compare APRs when shopping for loans.

Does making extra payments save money?

Yes, significantly. Even one or two extra payments per year can shave years off your loan term and save thousands in interest. Extra payments go directly toward the principal, reducing the balance that interest is calculated on.

What credit score do I need for a personal loan?

Requirements vary by lender. Generally: 720+ (excellent) qualifies for the best rates; 660–719 (good) qualifies for competitive rates; 580–659 (fair) may qualify but at higher rates; below 580 (poor) may struggle to qualify with traditional lenders.

Loan Calculator