Loan amount, Annual interest rate, Loan term
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How this calculator works
Most personal loans, car loans and fixed-rate mortgages are amortized: you pay the same amount each month, and the share going to interest shrinks as the balance falls. The payment depends on three things only: the amount borrowed, the annual interest rate and the number of months.
Formula
- Monthly rate r = annual rate / 12
- Monthly payment = P × r × (1 + r)^n / ((1 + r)^n − 1), where P is the loan amount and n the number of months
- At 0% interest: monthly payment = P / n
- Total interest = monthly payment × n − P
Worked example
200,000 at 6% for 30 years
- Loan amount
- 200,000
- Annual interest rate
- 6%
- Loan term
- 30 years
Result1,199.10 per month
360 payments on 200,000.00 at 6.00% a year.
Things to keep in mind
- The result excludes fees, insurance and taxes that lenders may add to the payment.
- Variable-rate loans change over time; this calculator assumes the rate stays fixed.
- Figures are estimates for planning. They are not financial advice, and they ignore taxes and fees unless stated.
Frequently asked questions
How is a monthly loan payment calculated?
Lenders use the amortization formula: payment = P × r × (1 + r)^n / ((1 + r)^n − 1), with r the monthly interest rate and n the number of monthly payments.
Does a longer term save money?
A longer term lowers the monthly payment but raises total interest, because you borrow the money for longer.
What is the difference between interest rate and APR?
The interest rate is the cost of borrowing the principal. APR also folds in most lender fees, so it is the better number for comparing offers.
Sources
More finance calculators
Results are estimates based on the values you enter and the published method shown above. They do not replace professional medical, financial or legal advice. Method reviewed October 7, 2026. About this site