Loan Calculator: Monthly Payment for Any Loan
Enter how much you borrow, the yearly interest rate and the number of monthly payments to see what the loan costs.
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Formula
For a fixed-rate loan repaid in equal monthly payments:
M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1)
Pis the loan amountris the monthly rate, the yearly rate ÷ 12 ÷ 100nis the number of monthly payments
At 0% interest the payment is P ÷ n. The payment is rounded to cents; total paid is M × n and total interest is total paid minus P.
Worked example
20,000 at 5% a year over 60 months:
r = 0.05 ÷ 12,n = 60,(1 + r)^60 = 1.28336M = 20,000 × r × 1.28336 ÷ 0.28336 =377.42 a month- Total paid is 377.42 × 60 = 22,645.20, so the interest is 2,645.20.
Frequently asked questions
How is the monthly payment on a loan calculated?
Each payment is the same: M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where P is the amount borrowed, r the monthly rate (yearly rate ÷ 12) and n the number of months. For 20,000 at 5% over 60 months, M is 377.42.
How much interest will I pay in total?
Total interest is the monthly payment times the number of months, minus the amount borrowed. At 377.42 a month for 60 months you pay 22,645.20, so the interest is 2,645.20.
Does a shorter term save money?
Yes. The payment is higher but you owe interest for fewer months. 20,000 at 5% over 36 months costs 599.42 a month and 1,579.12 in interest, against 2,645.20 over 60 months.
Are fees included in this payment?
No. This is the payment on the amount and rate you enter. Arrangement fees, insurance and other charges are extra, and the APR calculator shows how they raise the true yearly cost.