Loan Repayment Calculator
Calculate monthly loan payments, total interest, and full borrowing cost for any fixed-rate loan. Works for mortgages, car loans, and more.
Monthly Payment
$1,073.64
Total Paid
$386,511.57
Total Interest
$186,511.57
48.3% of total paid
Cost Breakdown
How to use this calculator
- Enter the total loan amount (the principal you are borrowing).
- Enter the annual interest rate quoted by your lender.
- Enter the loan term in years (e.g. 30 for a 30-year mortgage, 5 for a car loan).
- Results update instantly — compare different scenarios by adjusting the inputs.
How Loan Repayment Works: Amortization Explained
When you borrow at a fixed rate, the monthly payment is calculated so principal plus interest is paid off in equal installments over the term (amortization). The formula uses principal P, monthly rate r (annual ÷ 12), and number of payments n.
Early payments are mostly interest; over time more goes to principal. Extra payments early on save a lot of total interest because they avoid years of compounding interest on that balance.
Shortening the term (e.g. 15 vs 30 years) raises the payment but often cuts total interest sharply. Use the calculator to model rate and term changes before you sign.
Example: $300,000 at 6% APR over 30 years yields a payment of about $1,799/month (verify on this page). The same loan at 5.5% drops roughly to $1,703 — about $96/month less, which compounds to tens of thousands saved over the life of the loan. Always confirm APR vs nominal rate and whether your loan carries PMI, escrow, or fees that sit outside the principal-and-interest figure.
When this model applies: fixed-rate installment loans with a constant payment (fully amortizing). Adjustable-rate mortgages, interest-only periods, balloon payments, or revolving credit need different math. If you are comparing refinance offers, duplicate scenarios with the same remaining term vs. resetting to a new 30-year term — resetting often lowers the payment but can increase total interest.
Responsible use: outputs are educational. Lenders may round payments, apply different day-count conventions, or add taxes and insurance. For binding decisions, use your lender’s disclosures and a qualified advisor.
Key formulas (reference)
Monthly payment (fixed rate, monthly compounding): M = P × [r(1+r)^n] / [(1+r)^n − 1], where P = principal, r = annual rate / 12, n = years × 12. If r = 0, M = P / n.
Related tools
These free tools pair well with this page — open them in a new tab to finish your workflow.
Frequently Asked Questions
How is the monthly payment calculated?
Monthly payment = P × [r(1+r)^n] / [(1+r)^n - 1], where P is the principal, r is the monthly interest rate (annual rate / 12), and n is the total number of payments. This is the standard amortization formula for fixed-rate loans.
What is amortization?
Amortization is the process of paying off a loan through regular scheduled payments. Early payments are mostly interest; over time, more of each payment goes toward the principal. An amortization schedule shows the exact split for every payment.
What happens if I make extra payments?
Extra payments reduce the outstanding principal, which in turn reduces the total interest paid over the life of the loan and can shorten the repayment term significantly. Even one extra payment per year can save years off a 30-year mortgage.
What is an APR vs an interest rate?
The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus additional costs like origination fees, points, and other charges. APR is a more complete measure of the true cost of the loan.
What is a balloon payment?
A balloon payment is a large lump-sum payment due at the end of the loan term. Balloon mortgages typically have lower monthly payments for an initial period, then the remaining balance is due all at once. This tool calculates standard fully-amortizing loans without balloon payments.
What is the difference between principal and interest?
Principal is the original loan amount that you borrowed. Interest is the fee charged by the lender for the use of that money. Your monthly payment covers both — early in the loan, most goes to interest; as the principal decreases, more of each payment goes to principal.