Loan Repayment Calculator
Planning a loan requires understanding how monthly installments amortize principal and interest. This calculator computes monthly payments and total financing costs over the lifetime of a fixed-rate loan.
Calculated Result
Enter values to view result
Notice: This calculator provides mathematical estimates based on a standard fixed-rate amortization model. Actual loan offers may differ due to lender origination fees, compounding conventions, credit assessments, insurance, or variable rates.
Formula & Mechanics
M = P × [ r(1 + r)^n ] / [ (1 + r)^n - 1 ]
Where P is principal, r is the monthly interest rate (annual rate divided by 1200), and n is total monthly payments (years × 12).
Worked Step-by-Step Example
Scenario: A $15,000 personal loan at 6.5% interest over 5 years (60 months).
- Monthly rate r = 0.065 ÷ 12 ≈ 0.005417
- Total periods n = 60
- Evaluate formula: M ≈ $293.49 per month
- Total interest paid = ($293.49 × 60) - $15,000 = $2,609.40
Monthly installment: $293.49. Total interest: $2,609.40.
Frequently Asked Questions
Are closing costs included?
No. This estimate computes pure principal and interest amortization. Third-party closing fees and taxes must be evaluated separately.
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