How a personal loan payment is worked out
A personal loan has a fixed rate and a fixed term, so you pay the same amount every month until it’s paid off. The calculator uses the standard loan formula: the payment that brings the balance to zero at the end of the term, with interest charged on the balance each month.
Why the fee matters
Many lenders charge an origination fee, often 1% to 10% of the loan, and take it out before you get the money. You repay the full amount, but you received less, so the loan really costs more than its interest rate. The APR with the fee shows that cost as one rate, which makes offers with different fees easier to compare.
Comparing offers
A shorter term costs less interest but raises the payment. A longer term lowers the payment but costs more overall. If you’re using the loan to pay off cards, the debt consolidation calculator compares it with what you’re paying now.
Questions
What if I need the full amount after the fee?
Borrow a little more. To get $10,000 with a 5% fee, you’d borrow about $10,526.
Is the APR with the fee the same as my lender’s APR?
It should be close. Lenders must show an APR that includes required fees, worked out a similar way.
Can I pay a personal loan off early?
Usually, but check your loan agreement for a prepayment penalty first.
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.