Math

Loan calculator.

Monthly payment, total interest and total cost for any fixed-rate loan.

This is a planning estimate for a standard fixed-rate, fully-amortising loan. It doesn't include fees, insurance or any origination charges, which a lender's quote will reflect.

How loan payments work

A fixed-rate loan is repaid in equal monthly instalments using the same amortisation formula as a mortgage: each payment covers the month's interest first, with the rest reducing the balance. Early on, most of the payment is interest; as the balance falls, more goes to principal. Two levers matter most. A higher rate raises both the monthly payment and the total interest. A longer term lowers the monthly payment but increases the total interest paid, sometimes dramatically — stretching a car loan from four years to seven cuts the payment but can add thousands in interest. This works for car, personal and student loans; for a home loan with taxes and insurance, use the mortgage calculator.

FAQ

How is a monthly loan payment calculated?
With the amortisation formula M = P·r·(1+r)ⁿ / ((1+r)ⁿ−1), where P is the loan amount, r the monthly interest rate (APR ÷ 12) and n the number of monthly payments. The calculator applies it as you type.
Does a longer loan term save money?
It lowers the monthly payment but raises the total interest, because you're borrowing for longer. A shorter term costs more per month but less overall.

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