Loan Calculator
Calculate your monthly payment, total interest, and see a year-by-year amortization schedule. Or use reverse mode to find how much you can borrow.
Quick Answer
A $25,000 personal loan at 11% interest over 5 years costs about $543 per month, with $7,580 in total interest. Lower your rate by even 2% and you save over $1,400 in interest. Use the amortization table below to see exactly how much goes to principal vs. interest each year.
Your Loan Summary
Principal vs. Interest
Amortization Schedule (Year-by-Year)
| Year | Start Balance | Principal Paid | Interest Paid | End Balance |
|---|---|---|---|---|
| 1 | $25,000.00 | $3,968.87 | $2,553.86 | $21,031.13 |
| 2 | $21,031.13 | $4,428.14 | $2,094.59 | $16,602.99 |
| 3 | $16,602.99 | $4,940.56 | $1,582.17 | $11,662.43 |
| 4 | $11,662.43 | $5,512.28 | $1,010.45 | $6,150.15 |
| 5 | $6,150.15 | $6,150.15 | $372.58 | $0.00 |
About This Tool
The Loan Calculator helps you understand the true cost of borrowing before you sign. Whether you are considering a personal loan, student loan, or business loan, this tool breaks down your monthly payment, total interest, and shows a complete amortization schedule so you can see exactly where your money goes each year.
How Loan Payments Work
Loan payments are calculated using the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n - 1], where M is the monthly payment, P is the loan principal, r is the monthly interest rate, and n is the total number of payments. Early payments are heavily weighted toward interest, while later payments pay down more principal.
How Much Can I Borrow?
The reverse mode solves the same formula backward. Given a monthly payment you can afford, it calculates the maximum loan amount. This is useful when budgeting for a major purchase: start with what you can comfortably pay each month, then see what that translates to in borrowing power at different rates and terms.
Personal vs. Student vs. Business Loans
Personal loans typically carry rates of 8-36% depending on credit score, with terms of 2-7 years. Student loans often have lower rates (4-8%) and longer terms (10-25 years). Business loans vary widely (6-30%) based on the type (SBA, term loan, line of credit) and business financials. The loan type selector adjusts the default rate to match typical ranges.
Tips for Reducing Interest
- Shorten your term: A 3-year loan has higher monthly payments but far less total interest than a 5-year loan.
- Improve your credit: Even a small credit score improvement can lower your rate by 1-3%.
- Make extra payments: Paying even $50 extra per month can shave months off your loan and save hundreds in interest.
- Shop around: Rates vary significantly between lenders. Always get at least 3 quotes.
Frequently Asked Questions
How is the monthly payment calculated?
What is an amortization schedule?
Should I choose a shorter or longer loan term?
How does my credit score affect my loan rate?
What is the difference between APR and interest rate?
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