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Loan calculator
Calculate the monthly payment and total cost of any fixed-rate installment loan — personal, auto, student, business. Set principal, APR, and term to see the full breakdown.
Loan payment formula
Monthly payment = P × r × (1+r)^n / ((1+r)^n − 1) P = loan principal r = monthly interest rate (APR ÷ 12) n = number of monthly payments (term × 12)
The formula reverse-engineers a payment that pays off the loan in exactly n months. Early payments are mostly interest; later payments are mostly principal — that's amortization.
Common loan types at a glance
| Loan | Typical term | Typical APR | Secured? |
|---|---|---|---|
| Personal | 2–7 yrs | 8–18% | No |
| Auto (new) | 3–7 yrs | 5.5–8% | Yes (car) |
| Auto (used) | 2–6 yrs | 7–10% | Yes (car) |
| Student (federal) | 10–25 yrs | ~6.5% | No |
| Mortgage 30-yr | 30 yrs | 6.5–7.25% | Yes (home) |
| HELOC | 10–20 yrs | 7.5–9% | Yes (home) |
Lower payment vs less total interest
Stretching a loan over more years drops the monthly payment but raises total interest paid. $15,000 at 10% APR: 3 years = $484/mo, $2,425 interest. 5 years = $319/mo, $4,122 interest. 7 years = $249/mo, $5,896 interest. Pick the shortest term you can afford comfortably.
Loan Calculator FAQ
What's the difference between APR and interest rate on a loan?
Interest rate is the cost of the principal only. APR includes interest plus mandatory fees (origination, discount points) expressed as one annualized rate. APR is always equal to or higher than the interest rate. Compare loans on APR.
Should I take a shorter or longer loan term?
Shorter saves interest but raises payment. Rule of thumb: pick the shortest term where the payment stays under 10% of monthly gross income. For 0% intro loans, longest term possible. For high-APR debt, shortest term you can stand.
Can I pay off a loan early?
Yes, on most loans (federal student loans, mortgages, most auto and personal loans have no prepayment penalty). Some subprime auto and older mortgages carry penalties of 1–2% of remaining balance — check your contract. Extra payments go directly to principal and shave months off the term.
How is loan interest calculated?
Most installment loans use simple interest on the declining balance. Each month: interest = balance × (APR/12); principal paid = monthly payment − interest. As balance falls, more of each payment goes to principal. This is amortization.
What credit score do I need for a good loan rate?
720+ for the best rates across personal, auto, and mortgage loans. 680–720 gets near-prime rates. Below 660 you're in subprime — expect 2–3× the APR of prime borrowers. Improve score before applying for any large loan.
Are loans with no credit check legitimate?
Be careful. Legitimate no-credit-check options: payday alternative loans from credit unions (capped at 28% APR), 0% intro credit cards (with credit check). Avoid title loans (200%+ APR), payday loans (400%+), and online no-credit loans that promise large amounts.