Use this loan calculator to estimate a level payment for an amortizing loan. It can help you compare borrowing terms before speaking with a lender and understand how rate and term affect both the periodic payment and total interest.
How to use this calculator
Enter the amount borrowed, annual nominal interest rate, term in years, and payment frequency. The payment assumes a fixed rate, equal payments at the end of each period, and no fees or early repayments.
Formula & calculation method
Payment = L × i / (1 − (1 + i)^−N)L is the principal, i is the annual nominal rate divided by payments per year, and N is the total number of payments. At a zero rate, the payment is simply principal divided by N. Total repayment equals the payment multiplied by N, and interest is repayment minus principal.
Worked example
A 25,000 loan over five years at 7.5% with monthly payments has 60 payment periods. Increasing the term generally lowers each payment but can raise total interest because the balance remains outstanding longer.
Why this is useful
The results provide a consistent basis for comparing offers. You can test a shorter term, a different rate, or another payment schedule and immediately see the trade-off between cash flow and borrowing cost.
Limitations to keep in mind
A lender may use a different day-count convention, add fees, charge insurance, or apply a variable rate. The estimate excludes those items and does not represent a loan offer, approval, or personalized financial recommendation.
Frequently asked questions
Why is total interest higher on a longer loan?
A longer term usually reduces each payment but leaves principal outstanding for more periods, so interest has more time to accrue.
Does the payment include lender fees?
No. It includes estimated principal and interest only. Review the lender's full cost disclosure for origination fees, insurance, and other charges.
What happens at a 0% rate?
The principal is divided evenly across all payment periods, so total interest is zero in this simplified model.