How this calculator works
Lenders use a fixed formula to spread a loan into equal monthly payments, known as amortization. Each payment is split between interest (the lender's charge for the money) and principal (paying down what you actually borrowed). Early payments are interest-heavy; later payments are mostly principal. This calculator runs that exact formula — the same one your bank uses — every time you move a slider.
A worked example
Say you borrow $25,000 for a car at 7.5% APR over 5 years. Your monthly payment comes out to roughly $501. Over 60 payments, you'd pay about $5,060 in interest — meaning the car really costs you close to $30,060 in total. Stretch the same loan to 7 years and the monthly payment drops to around $383, but total interest climbs to roughly $7,210. Try both scenarios in the calculator above to see the trade-off for yourself.
Frequently asked questions
How is my monthly loan payment calculated?
This calculator uses the standard amortization formula lenders use: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the amount borrowed, r is your interest rate divided by 12 (the monthly rate), and n is the total number of monthly payments. The result is the fixed payment that pays off the loan, plus all interest, by the end of the term.
What's the difference between interest rate and APR?
Your interest rate is the cost of borrowing the principal, before fees. APR (Annual Percentage Rate) rolls in lender fees and other costs, so it's usually a little higher. For a quick estimate, either number works in this calculator — but use the APR from your actual loan offer for the most accurate result.
Why is my total interest so much higher on longer terms?
A longer term lowers your monthly payment, but you're borrowing the lender's money for more months — so more interest accrues before the balance is paid down. Use the year slider above to see how stretching the same loan from 3 to 7 years changes total interest paid.
Is this calculator accurate for my country?
The math is universal — it's the same formula banks use worldwide. Switch the currency symbol in the calculator to match your loan, and use the interest rate exactly as quoted by your lender (some countries quote monthly rates, so multiply by 12 first if needed).
Does using this calculator affect my credit score or send my data anywhere?
No. Every number you enter is calculated directly in your browser using JavaScript — nothing is transmitted to a server, stored, or linked to you in any way.
This calculator provides estimates for general informational purposes only and is not financial advice. Actual loan terms, fees and APR are set by your lender — confirm final numbers with your official loan agreement before making a decision.