How to calculate loan payments
Enter the total loan amount, the annual interest rate (e.g. 5.0 for 5%), and the loan term in years. The monthly payment is calculated using the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n − 1], where P is the principal, r is the monthly rate (annual rate ÷ 12), and n is the total number of payments (years × 12).
Loan payment examples
A $10,000 personal loan at 7% for 3 years costs about $309/month. A $25,000 auto loan at 5% for 5 years costs about $472/month. A $50,000 loan at 6% for 10 years costs about $555/month. Lower rates and shorter terms reduce the total interest paid significantly.
Frequently Asked Questions
Does this include fees or insurance?
No — this calculator covers principal and interest only. Origination fees, insurance, or other charges vary by lender and should be factored in separately.
How can I reduce my monthly payment?
You can lower your payment by increasing the loan term, securing a lower interest rate, or reducing the loan amount with a larger down payment.