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Simple Calculators

Loan Payment Calculator

Calculate monthly loan payments with detailed amortization schedules for personal, auto, business, and mortgage loans

$
%
years
$/mo

Extra payment is optional. It goes straight to principal, which cuts both the payoff time and the total interest.

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Quick summary

Enter a loan amount, annual interest rate, and term to get your fixed monthly payment, total interest, payoff date, and a full amortization schedule. Example: $25,000 at 6.5% for 5 years costs $489.15 a month and about $4,349 in interest. Adding an optional extra monthly payment shows how much interest you save and how much sooner you finish. Results are estimates, not a loan offer.

Reviewed by Simple Calculators TeamLast reviewed

For planning only — not financial or tax advice. Results are estimates based on your inputs and the stated assumptions. Confirm important decisions with a qualified professional.

How to use this calculator

  1. Enter the Loan Amount you plan to borrow (between $500 and $5,000,000).
  2. Enter the annual Interest Rate from your loan offer.
  3. Enter the Loan Term in years, for example 5 for a typical personal or auto loan.
  4. Choose a Loan Type (Personal, Auto, Business, or Mortgage); it labels the loan, and the payment math is the same for every type.
  5. Optionally enter an Extra Payment per month to see an accelerated payoff, then click Calculate Loan Payment.
  6. Read Monthly Payment, Total Interest, Payoff Date, and Interest Savings, then open the Amortization Schedule to see how each payment splits between principal and interest.

Mathematical Formulas & Examples

Monthly Payment Formula

M=P×r(1+r)n(1+r)n−1M = P \times \frac{r(1+r)^n}{(1+r)^n - 1}
M
Fixed monthly payment (rounded to the cent)
P
Loan amount
r
Monthly interest rate (annual rate ÷ 12 ÷ 100)
n
Total number of monthly payments (term in years × 12)

Worked example

A $25,000 loan at 6.5% annual interest for 5 years

Given
P = $25,000
r = 0.0054167 (6.5% ÷ 12)
n = 60 months
Calculation
M=25,000×0.0054167(1.0054167)60(1.0054167)60−1M = 25{,}000 \times \frac{0.0054167(1.0054167)^{60}}{(1.0054167)^{60} - 1}
Result
M = $489.15 per month

Total Interest Formula

Total Interest=(M×n)−P\text{Total Interest} = (M \times n) - P
M
Monthly payment
n
Total number of payments
P
Loan amount

Worked example

Total interest on the same $25,000, 5-year loan

Given
M = $489.15
n = 60 months
P = $25,000
Calculation
Total Interest=(489.15×60)−25,000\text{Total Interest} = (489.15 \times 60) - 25{,}000
Result
Total Interest ≈ $4,349 (the amortization schedule shows $4,349.20 after month-by-month rounding)

Interest Savings from Extra Payments

Savings=Interestno extra−Interestwith extra\text{Savings} = \text{Interest}_{\text{no extra}} - \text{Interest}_{\text{with extra}}
Interest (no extra)
Total interest if you pay only the required payment for the full term
Interest (with extra)
Total interest from the month-by-month schedule with the extra payment applied to principal

Worked example

Adding $100 per month to the $25,000, 6.5%, 5-year loan

Given
Interest (no extra) = $4,349.22
Interest (with extra) = $3,483.80 (paid off in 49 months instead of 60)
Calculation
Savings=4,349.22−3,483.80\text{Savings} = 4{,}349.22 - 3{,}483.80
Result
Savings = $865.42

Frequently asked questions

How is my monthly loan payment calculated?

Your monthly payment comes from the standard amortization formula M = P × r(1+r)^n ÷ ((1+r)^n − 1), where P is the loan amount, r is the annual rate divided by 12, and n is the number of monthly payments. The result is a fixed payment that covers that month's interest plus enough principal to reach a zero balance exactly at the end of the term.

What is the difference between APR and interest rate?

The interest rate is the yearly cost of borrowing the principal, while the APR (annual percentage rate) also folds in certain lender fees, so it shows a fuller cost of the loan. This calculator uses whatever rate you enter. Enter the note interest rate to match your lender's payment, and use APR when you want to compare total borrowing cost between offers.

How do extra payments affect my loan?

Extra payments go straight to principal, which lowers the balance that interest is charged on, so you pay less interest and finish sooner. In this calculator, adding $100 a month to a $25,000 loan at 6.5% for 5 years cuts the payoff from 60 to 49 months and saves about $865 in interest. Check that your lender applies extra payments to principal and does not charge a prepayment penalty.

Should I choose a shorter or longer loan term?

A shorter term means a higher monthly payment but less total interest, and a longer term lowers the payment but costs more interest overall. Run both terms here and compare the Monthly Payment and Total Interest cards side by side. A payment that fits your budget comfortably matters, since missing payments costs more than the interest saved by a shorter term.

Does the loan type change the calculation?

No, the loan type does not change the math; every type uses the same fixed-payment amortization formula. The Loan Type selector simply labels your calculation as a personal, auto, business, or mortgage loan. For a mortgage that should include property tax, insurance, and PMI, use the mortgage calculator, which adds those costs to the payment.

Why is more of my early payment interest than principal?

Interest is charged on the outstanding balance, so it is highest at the start of the loan when you owe the most. Because the payment is fixed, each month a little less goes to interest and a little more goes to principal. The Amortization Schedule shows this shift month by month, with the payment, principal, interest, any extra payment, and the remaining balance for each month.

What are common mistakes when estimating a loan payment?

The most common mistake is entering the term in months when the field expects years, which makes the payment far too low. Others are using an advertised "as low as" rate instead of the rate you were actually quoted, and ignoring origination fees that are deducted from the amount you receive. Compare offers using the same loan amount and term so the numbers line up.

Key terms

Principal
The amount of money you borrow from the lender
Interest Rate
The annual rate charged by the lender on the outstanding balance, excluding fees
Amortization
The process of paying off debt over time through regular payments of principal and interest
Extra Payment
Additional payments made beyond the required monthly payment to reduce principal faster

Methodology, sources & limitations

This page shows the formula, assumptions, and limitations used for this estimate. Rates, thresholds, and other time-sensitive inputs can change, so verify them against the relevant official source before relying on a result.

For our review approach and the primary sources we consult, see the methodology and source policy. If you spot an outdated figure or formula, please contact us with a correction.