Loan Calculator - Monthly Repayment | Financial Calculator

Free loan calculator for monthly repayment and total interest. Compare equal payment vs equal principal methods with a full amortization schedule.

What this loan calculator models

The tool models a fixed-rate installment loan two ways. Equal Payment mode applies the amortization formula with a monthly rate of the annual rate divided by 12, producing a constant payment whose interest share shrinks while the principal share grows. Equal Principal mode fixes the principal portion at the loan amount divided by the number of months, so total interest works out to r × (P ÷ n) × n(n+1) ÷ 2 — always somewhat less than Equal Payment over the same term.

Worked example at a hypothetical rate

Borrowing $20,000 at a 6% annual rate for 60 months: Equal Payment charges $386.66 per month and $3,199.36 in total interest. Equal Principal starts at $433.33, ends at $335.00, and accrues $3,050.00 in interest — about $149 less, in exchange for higher early payments. Rates here are illustrative, not offers; this page is informational only and actual loan terms vary by lender.

How to Use

  1. Loan Amount — Enter the total principal you plan to borrow, such as $20,000 for a five-year car loan or a larger figure for a mortgage
  2. Annual Interest Rate — Enter the nominal annual rate (%). The calculator divides it by 12 to get the monthly rate used in every formula
  3. Loan Term — Enter the repayment period and switch freely between years and months — a 5-year term becomes 60 monthly payments
  4. Repayment Method — Choose Equal Payment for a fixed monthly amount, or Equal Principal for payments that start higher and decline every month
  5. Calculate — Click Calculate to see the monthly payment, total repayment, and total interest for your inputs
  6. Review the Schedule — Open the amortization table to watch each payment split between principal and interest as the balance falls to zero

FAQ

Which repayment method saves more money?

Equal Principal results in less total interest, but initial payments are higher. Equal Payment keeps payments the same throughout. Choose based on your cash flow needs.

Will early repayment change the results?

Yes, early repayment may incur prepayment penalties and will differ from this calculator's results. Always check your loan agreement for exact terms.

Can I calculate variable rate loans?

This calculator assumes a fixed interest rate. For variable rate loans, use it as an estimate only, as payments will change as rates fluctuate.

How is the monthly payment actually calculated?

The calculator uses the standard amortization formula P × r(1+r)^n ÷ ((1+r)^n − 1), where P is the principal, r the monthly rate (annual rate ÷ 12), and n the number of monthly payments. For example, $20,000 at a hypothetical 6% annual rate over 60 months gives $386.66 per month.

Why does the first Equal Principal payment cost more?

Equal Principal repays a fixed slice of principal (P ÷ n) every month plus interest on the remaining balance. The first payment carries interest on the full balance — $433.33 in the example above — and each later payment shrinks, ending at $335.00.

How does the calculator treat the final payment?

The schedule is built month by month at full precision, so the last row reduces the balance exactly to zero; only displayed values are rounded to two decimals. The model includes no balloon payments, fees, or prepayment penalties.