Loan Calculator
How much will a loan cost me each month, and in total?
Auto loan, personal loan, or any installment loan: get the monthly payment, total interest, and a full amortization schedule in seconds. Most auto and personal loans are amortizing installment loans: you borrow a lump sum and repay it in fixed monthly payments over a set term. Each payment is split between interest (charged on the remaining balance) and principal (reducing the balance).
Auto loan, personal loan, or any installment loan: get the monthly payment, total interest, and a full amortization schedule in seconds.
Last updated: October 2026
Loan details
Amortization schedule (yearly)
| Year | Interest paid | Principal paid | Balance |
|---|---|---|---|
| Enter your details and click Calculate. | |||
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How loan payments are calculated
Most auto and personal loans are amortizing installment loans: you borrow a lump sum and repay it in fixed monthly payments over a set term. Each payment is split between interest (charged on the remaining balance) and principal (reducing the balance). The payment is computed with the standard amortization formula:
where P is the amount borrowed, r the monthly interest rate, and n the number of payments. Because interest is charged on the shrinking balance, early payments are interest-heavy and later payments are mostly principal, visible in the schedule above.
Unlike mortgages, auto and personal loans rarely include escrow, the payment you see is the whole payment. But watch for origination fees on personal loans (often 1-8% of the amount, deducted before you receive the money) and add-on products at dealerships (extended warranties, GAP insurance, paint protection), which get rolled into the loan and charged interest for years.
APR vs. interest rate
The interest rate is what the lender charges on the balance. The APR (annual percentage rate) folds in fees, origination charges, points, certain closing costs, and spreads them across the loan, giving the true yearly cost as a single number. Two loans with the same interest rate can have different APRs if one charges bigger fees.
For comparing offers, APR is the better number, it is the only one that captures the fees. The gap between rate and APR also tells you something: a wide gap means heavy fees, which hurts more if you pay the loan off early (you paid the fees but got less time at the lower rate).
Term length: the hidden cost
Dealers love long terms because the payment looks small, but every extra year adds interest and keeps you "underwater" (owing more than the car is worth) longer. As a rule of thumb, keep auto loans to 5 years or less and personal loans as short as your budget allows. If you can afford extra principal payments, they go straight at the balance and shorten the loan with no penalty on most loans, just confirm yours has no prepayment fee.
Being underwater matters most when life happens: if the car is totaled or you need to sell, the gap between the loan balance and the car's value comes out of your pocket. Shorter terms and bigger down payments are the cure.
Tips for borrowing smarter
Get pre-approved before you shop. For car loans, a bank or credit union pre-approval gives you a rate to beat, and turns you into a cash buyer at the dealership, where financing is a profit center.
Negotiate the price, not the payment. Dealers who ask "what monthly payment are you looking for?" can hit any payment by stretching the term. Settle the out-the-door price first, then talk financing.
Check for prepayment penalties. Most auto and personal loans have none, but some subprime and specialty loans do. Extra principal payments are one of the cheapest ways to cut interest, make sure yours allows them.
Think in total cost, not monthly payment. A $453 payment sounds better than $594 until you see the $8,030 in interest versus $5,640. Always compare the "total of payments" line before signing.
Worked example: a $35,000 personal loan at 9% for 4 years
Take a $35,000 personal loan at 9% APR repaid over 4 years (48 payments). The monthly rate is 0.75%, and the amortization formula gives a monthly payment of $870.98. Over the life of the loan you pay $41,806.87 in total, which means $6,806.87 in interest on top of the $35,000 borrowed.
The very first payment shows how amortization works: $262.50 of that $870.98 goes to interest (the $35,000 balance times 0.75%), and only $608.48 reduces the principal. Each month the interest slice shrinks and the principal slice grows, which is why extra payments early in the loan save the most interest.
Total cost of credit: 5-year vs. 7-year terms
Borrow $30,000 at 7% and the term you pick changes the real price dramatically. Over 5 years the payment is $594.04 a month and total interest is $5,642.16. Stretch to 7 years and the payment falls to $452.78 a month, but total interest climbs to $8,033.55.
That is the trade in plain numbers: you save $141.26 a month but pay $2,391.40 extra in interest. On a depreciating asset like a car, the longer term also keeps you owing more than the car is worth for years longer. When a dealer pushes the 7-year option, ask for the total-of-payments figure for both terms before deciding.
Loan FAQs
How do I calculate a loan payment?
Use the amortization formula M = P × r(1+r)^n / ((1+r)^n − 1), where P is the loan amount, r the monthly rate, and n the number of payments, or just enter your numbers above, since the calculator applies the same formula banks use.
What is a good interest rate for a car loan?
It depends on credit score and market conditions. Excellent-credit borrowers often beat the national average by several points. A 2-point difference on a 5-year $30,000 loan costs about $1,600 in extra interest, so comparing lenders pays.
Is a longer loan term better because the payment is lower?
The payment drops but total interest rises sharply, and you stay underwater longer. Shorter terms usually win, especially on depreciating assets like cars. Compare the total-of-payments line, not just the monthly figure.
Should I pay extra toward my loan principal?
Extra principal payments shorten the loan and cut total interest, with no penalty on most auto and personal loans. Even $50 extra a month makes a visible difference. Confirm your loan has no prepayment fee first.
What is the difference between APR and interest rate?
The interest rate is the charge on the balance; the APR folds in fees (origination, points) to show the true yearly cost. Use APR to compare offers, a wide gap between the two signals heavy fees that hurt most if you repay early.
What does it mean to be underwater on a car loan?
Owing more than the car is worth, common with small down payments and long terms, since cars depreciate fastest in the first years. If the car is totaled or you must sell, you pay the gap out of pocket. GAP insurance covers the difference, but shorter terms and bigger down payments prevent it.
How much does a 1% rate difference cost on a car loan?
On a $30,000 loan over 5 years, 6% costs $4,799.04 in total interest while 7% costs $5,642.16, a difference of $843.11. That is why shopping even two or three lenders for a slightly better rate is worth an afternoon: a single percentage point is worth hundreds of dollars on a typical car loan, and more on larger balances.
How much does paying an extra $100 a month save?
On a $30,000 car loan at 7% over 5 years, adding $100 to each monthly payment pays the loan off in 50 months instead of 60 and cuts total interest from $5,642.16 to $4,669.83, saving $972.33. Extra payments go straight to principal, and the earlier in the loan you make them, the more interest each extra dollar avoids.
What is loan amortization in simple terms?
Amortization just means paying a loan off in equal installments where each payment covers that month's interest first and the rest reduces what you owe. Early on, most of your payment is interest because the balance is large; near the end, almost all of it is principal. The amortization schedule in the calculator above shows this shift year by year.
Can I use this calculator for a mortgage?
The math is identical: mortgages amortize with the same formula. The difference is that mortgage payments usually include escrow for property tax and homeowner's insurance, which this calculator does not add. For the full picture, use our mortgage calculator, which includes taxes, insurance, PMI, and HOA dues.
Should I compare loans by monthly payment or total cost?
Compare the total cost, meaning every payment added up, because the monthly figure hides how long you pay. A lower monthly payment on a longer term can cost thousands more overall. This calculator shows monthly payment, total interest, and total cost side by side so you can judge both.
How much total interest will I pay on my loan?
Multiply the monthly payment by the number of payments and subtract the amount borrowed; the remainder is total interest. It grows with the rate and with the term length. The calculator reports it directly, along with the payoff date.