The loan payment formula
For a fixed-rate loan paid monthly, the payment is P × r ÷ (1 − (1 + r)−n), where P is the amount borrowed, r is the interest rate per month (the APR divided by 12) and n is the number of payments. Each month, interest is charged on the balance, and the rest of the payment pays the balance down.
Fixed term or fixed payment
Choose Fixed Term when you know how long the loan is, like a 5-year personal loan, to find the payment. Choose Fixed Payment when you know what you can pay each month, to find how long it takes and what it costs.
Calculators for specific loans
For car loans with a down payment and sales tax, use the auto loan calculator. For loans with an origination fee, the personal loan calculator shows the real APR. Mortgages also include taxes and insurance, which this calculator doesn’t.
Questions
Is the interest rate the same as the APR?
Not always. The APR includes some fees as well as interest. Use the interest rate to work out the payment.
Why is so much of my first payment interest?
Interest is charged on the balance, which is highest at the start. As the balance falls, more of each payment goes to principal.
Does it work for 0% loans?
Yes. With no interest, the payment is the amount borrowed divided by the number of months.
Estimates only, using monthly compounding at your APR divided by 12. Your lender’s numbers may differ with daily interest, fees or rate changes. This calculator isn’t financial advice.