Loan Calculator
About the Loan
This loan calculator works out your monthly repayments, the total interest you will pay, and gives you a preview amortisation schedule for any fixed-rate installment loan. It is ideal for personal loans, car loans, student loans, or any fixed monthly repayment loan where the rate and term are fixed up front. Loans are amortised: each monthly payment covers the interest that has accrued since the last payment, and the remainder goes toward reducing the principal. At the start of a loan term most of your payment is interest and very little is principal, so the balance comes down slowly. As the balance falls, the interest portion of each payment shrinks and more goes principal — this is why the final months of the loan pay the balance off quickly. An amortisation schedule shows this breakdown for every single payment, which is exactly what this calculator gives you. To use the calculator, enter the amount you are borrowing, the annual interest rate, and the term in years or months. It returns your monthly payment, the total repayment figure, the total interest cost, and a preview of the first 12 payments showing how each is split between principal and interest. This is the single most useful insight for understanding the real cost of a loan and where to make savings. Understanding the true cost matters because the "headline" rate can be misleading. Comparing APRs rather than the flat interest rate gives you the true cost, since APR includes lender fees. And you can often pay a loan off faster — extra principal payments, a refinance to a lower rate, or moving to fortnightly payments (26 half payments a year, equal to 13 full payments instead of 12) all accelerate repayment and slash total interest. Use this calculator to model the scenario before you borrow.
How to use this tool
- Enter the loan amount — the principal you plan to borrow.
- Enter the annual interest rate as a percentage.
- Enter the term in years (or switch to months) and press Calculate.
- Read your monthly payment, total interest, and amortisation preview.
- Experiment with the term and rate to compare scenarios before committing.
Common uses
- Estimating monthly repayments before taking out a personal or car loan
- Comparing the true cost of different loan terms and rates
- Understanding how much of each payment is interest vs principal
- Planning accelerated repayment strategies to cut total interest
Frequently asked questions
How are loan payments calculated?
Loan payments are calculated using the amortisation formula: M = P × [r(1+r)^n] / [(1+r)^n - 1], where M is the monthly payment, P is the principal, r is the monthly interest rate, and n is the total number of payments. Each payment covers interest accrued plus a portion of the principal.
What is an amortization schedule?
An amortization schedule is a table showing each loan payment broken down into principal and interest. Early payments are mostly interest; later payments are mostly principal. The schedule also shows the remaining balance after each payment.
How can I pay off my loan faster?
You can pay off a loan faster by making extra principal payments, refinancing to a lower interest rate, or switching to biweekly payments (26 half-payments per year = 13 full payments instead of 12). Even small extra payments can significantly reduce total interest.
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal. APR (Annual Percentage Rate) includes the interest rate plus other fees (origination, closing costs), giving you the true cost of the loan. Always compare APRs, not just interest rates.
Does paying biweekly save money?
Biweekly payments mean you make 26 half-payments a year, which equals 13 full monthly payments — one extra payment a year that goes to principal. This can shorten the loan term and cut total interest noticeably.