Work out the monthly payment, total interest and payoff date of any loan, and see how extra payments cut the cost.
Quick answer
The monthly payment is $506.91. Over 60 payments you repay $30,414.59 in total, which is $5,414.59 of interest on top of the $25,000 borrowed.
| Term | Monthly payment | Total interest |
|---|---|---|
| 3 years | $783.41 | $3,202.73 |
| 4 years | $610.32 | $4,295.51 |
| 5 years | $506.91 | $5,414.59 |
| 6 years | $438.33 | $6,559.83 |
| 7 years | $389.66 | $7,731.05 |
These figures are computed with the same formulas as the Loan Calculator above. Change the inputs in the tool to see your own result. For a full table, see Mortgage payment chart and Loan payment chart and EMI per lakh chart.
The Loan Calculator works out the monthly payment, total interest and total cost of any fixed-rate loan, then shows a balance chart and a payment schedule by year or by month. Add an optional extra monthly payment to see how much interest you save and how much sooner the loan ends. It works for personal, auto, student and other instalment loans in any currency.
Made for everyone. Typical uses:
A $25,000 loan at 6% for 5 years costs $483.32 a month and $3,999.20 in interest, for $28,999.20 in total. Paying an extra $100 a month clears it in 49 months instead of 60 and cuts the interest to $3,206.27, a saving of $792.93.
The calculator assumes a fixed rate, equal monthly payments and interest calculated monthly. Fees, insurance, variable rates and interest-only periods are not included, so your lender's quote is the final figure.
Accuracy: Formulas follow standard published methods and are checked against worked reference examples. Results are estimates based on the values you enter and do not replace advice from a qualified professional.
Expert Tip
Before choosing a longer term because the monthly payment looks smaller, run the same loan amount at a shorter term -- the total interest saved is often large enough to be worth the higher monthly payment.
Most instalment loans, including personal loans, car loans and student loans, work the same way. You borrow an amount, agree a yearly interest rate and a number of months, and repay with equal monthly payments. Each payment covers the interest that has built up since the last one and pays down some of the balance. Because interest is charged on what you still owe, the interest part is largest at the start and shrinks every month, while the principal part grows.
The payment itself comes from a standard formula: payment = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where P is the amount borrowed, r is the monthly rate (the yearly rate divided by 12) and n is the number of payments. The calculator applies it for you and, if the rate is exactly zero, simply divides the loan by the number of months.
Borrow $25,000 at 6% for five years. The monthly payment is $483.32. Over 60 payments you repay $28,999.20, so the loan costs $3,999.20 in interest. Stretch the same loan to seven years and the payment falls to $365.21, but the interest rises to $5,677.96. Shorten it to three years and the payment jumps to $760.55, while the interest drops to $2,379.74.
This trade-off is the heart of every loan decision. A longer term makes each payment easier to afford and makes the loan more expensive; a shorter term costs more per month and saves interest. The right choice is the shortest term you can pay comfortably without draining your emergency savings.
Any money paid above the required amount goes straight to the balance, so you owe less interest every month afterwards. On the $25,000 example, adding $100 a month clears the loan in 49 months instead of 60 and cuts the interest to $3,206.27, a saving of $792.93. The earlier you start, the bigger the effect, because the extra money shortens the period during which interest accrues on the largest balances.
Before you commit, check that your lender applies extra payments to principal and does not charge a prepayment penalty. Some lenders hold extra money against the next instalment instead, which brings no interest saving. Put the extra amount into the calculator, compare it with the standard plan, and decide whether the saving is worth the reduced cash flow.
The interest rate is the yearly cost of the money you borrow. APR (annual percentage rate) adds certain fees, such as origination charges, so it is the better number for comparing offers. A loan with a lower rate and a 3 percent origination fee can cost more than one with a slightly higher rate and no fee. Use the APR as the rate when you want the calculator to reflect the real cost.
Start with your budget: work out the maximum monthly payment that leaves room for rent or a mortgage, food, transport, savings and irregular costs. Then find the shortest term that keeps the payment under that limit. Check your credit position before applying, since a better score can move the rate by several percentage points, which on a large loan matters more than any fee.
For a car with tax, fees, a trade-in and a down payment, the Car Payment Calculator is more precise. For home loans use the Mortgage Calculator, and for a payment quoted as an EMI use the EMI Calculator. If a credit card is part of the picture, the Credit Card Payoff Calculator shows how fast you can clear it. The article on loan payments explained covers the maths in more depth.
A calculator gives a clean number for a clean loan. Real loans can include a first payment that is shorter or longer than a month, fees added to the balance, rate changes, and insurance premiums. Treat the result as an estimate for comparing options, then ask the lender for a written repayment schedule before you sign. Nothing you type here is stored or sent: the calculation runs in your browser.
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Reference table with CSV download.
Reference table with CSV download.
Reference table with CSV download.
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