MyCalcul LogoMyCalcul

Loan Calculator

Estimate your monthly loan payments for personal, car, or other loans.

Finance
Loan Calculator
Estimate your monthly loan payments.

Advertisement

Related Calculators

Mortgage Calculator
Calculate your monthly mortgage payment, total interest, and amortization schedule.
Tip Calculator
Calculate the tip amount for a bill and split it among people.
Discount Calculator
Calculate the final price after a discount.
Salary Calculator
Convert your salary between hourly, weekly, bi-weekly, monthly, and yearly rates.

Advertisement

Understanding Your Loan Payments

Our Loan Calculator helps you understand the financial commitment of a loan by estimating your monthly payments. This tool is perfect for planning for personal loans, auto loans, or other types of financing where you have a fixed interest rate.

The Loan Formula Explained

The formula for calculating a fixed monthly loan payment is the same as for a mortgage: M = P[r(1+r)^n] / [(1+r)^n - 1] Where:

  • M = Your monthly payment
  • P = The principal loan amount
  • r = Your monthly interest rate (annual rate divided by 12)
  • n = The total number of payments (loan term in years multiplied by 12)

How to Use the Calculator

  1. Loan Amount: Enter the total amount of money you are borrowing.
  2. Annual Interest Rate: Input the annual interest rate for the loan.
  3. Loan Term: Enter the duration of the loan in years.

After filling in the fields, the calculator will show your estimated monthly payment, the total you'll pay over the life of the loan, and the total interest paid.

Real-World Example

Suppose you are taking out a $15,000 personal loan to consolidate debt. The loan has a 5-year term and an annual interest rate of 9%.

  • Principal (P): $15,000
  • Monthly Interest Rate (r): 9% / 12 = 0.0075
  • Number of Payments (n): 5 years * 12 = 60

Using these figures, your estimated monthly payment would be $311.38. Over 5 years, you would pay a total of $18,682.80, with $3,682.80 of that being interest.

Frequently Asked Questions (FAQ)

  • What's the difference between interest rate and APR? The interest rate is the cost of borrowing the principal amount. The Annual Percentage Rate (APR) is a broader measure that includes the interest rate plus any additional fees or costs associated with the loan, giving you a more complete picture of the total cost.
  • Can I pay my loan off early? Most personal loans do not have prepayment penalties, meaning you can pay them off early to save on interest. However, you should always check the terms of your specific loan agreement.
  • How can I get a lower interest rate? Lenders determine your interest rate based on factors like your credit score, income, and debt-to-income ratio. Improving your credit score and reducing existing debt before applying can help you qualify for a lower rate.