Frequently Asked Questions
How is the monthly loan payment worked out?
The calculator uses the standard amortization formula, the same one a mortgage uses: M = P × r(1+r)^n ÷ ((1+r)^n − 1), where P is the amount borrowed, r is the monthly interest rate (the annual rate divided by 12) and n is the number of monthly payments. That produces the single fixed monthly payment which clears the loan exactly over the chosen term, with each payment covering the interest accrued that month and chipping away at the principal. Total interest is that monthly payment multiplied by the number of months, minus the original principal you borrowed; total repayment is principal plus total interest. If you set the rate to 0%, there is no interest to spread, so the payment is simply the principal divided by the number of months. Everything runs in your browser, so nothing you type is sent anywhere.
Can I enter the term in months or years?
Yes. Use the months / years unit selector to match how your loan is quoted, and enter the matching number in the term field. Auto and personal loans are usually expressed in months — 36, 48, 60 or 72 are common — while you might think of a student loan or a longer personal loan in years. Internally the calculator always works in months: when you choose years it multiplies your figure by twelve, because one year is twelve monthly payments, so the underlying amortization math is identical either way. Switching the unit re-reads the number currently in the term box as the new unit rather than converting it for you, so after you flip between months and years, glance at the value and retype it if needed. The monthly payment, total interest and total repayment all update instantly as you change any input.
What is the difference between this and the mortgage calculator?
The core engine is the same amortization formula, so for a plain fixed-rate installment loan the monthly payment from both tools matches to the cent. The Mortgage Calculator layers on home-specific features that this page deliberately leaves out: it folds annual property tax and homeowners insurance into the monthly figure and builds a year-by-year amortization schedule, because a mortgage typically runs for fifteen to thirty years and those extras dominate the real cost of owning. This Loan Calculator is streamlined for shorter borrowing — auto, personal and student loans — where you mainly want three numbers fast: the monthly payment, the total interest and the total repayment, without tax or insurance fields cluttering the form. Pick whichever matches what you are borrowing for: the mortgage tool for a house, this one for a car, consolidation or tuition.
Does it account for fees or early payoff?
No. The calculator assumes a fixed interest rate, equal monthly payments and no extra charges, so it does not model origination or application fees, late fees, insurance add-ons, or the interest you would save by making extra payments or clearing the loan early — none of those are calculated here. Because it works from the quoted annual rate rather than an APR that bundles fees, and because real lenders sometimes use a slightly different day-count or rounding convention than the standard monthly formula, your lender's official figure can differ from this estimate by anywhere from a few cents to a few dollars a month. Treat the result as a fast, private way to compare offers and sanity-check a quote, then confirm the exact, legally binding numbers in your loan agreement or truth-in-lending disclosure before you sign.
How does a longer term change the payment and total interest?
Stretching a loan over more months lowers the monthly payment but raises the total interest, and the calculator lets you see that trade-off instantly by changing only the term. A longer term spreads the same principal across more payments, so each one is smaller and easier on your monthly budget; the catch is that you are borrowing the money for longer, so interest accrues over more months and the total interest — and therefore the total repayment — climbs. A shorter term does the opposite: a higher monthly payment, but less interest paid overall and a debt that is gone sooner. Try entering the same amount and rate at, say, 36, 48 and 60 months and compare the monthly payment against the total interest each time. The right term is the shortest one whose monthly payment still fits comfortably in your budget.
What is the difference between total interest and total repayment?
These are two of the three results, and it helps to keep them straight. Total repayment is the grand total of money that leaves your pocket over the life of the loan — every monthly payment added together, which equals the amount you borrowed (the principal) plus all the interest. Total interest is just the extra part: the cost of borrowing, on top of returning what you took out. In other words, total repayment minus the principal equals the total interest, and principal plus total interest equals the total repayment. The monthly payment is simply that total repayment divided evenly across the number of months. Looking at all three together tells you not only what you will pay each month, but how much the loan actually costs you beyond the sum you borrowed — the number that matters most when comparing offers at different rates and terms.