Loan Calculator
Calculate your monthly loan payments, total interest paid, and view an amortization schedule.
Loan Parameters
Amortization Schedule
| Payment No. | Payment | Interest | Principal | Remaining Balance |
|---|
Loan Calculation Formulas
Understanding how loan payments are calculated can help you make informed financial decisions.
Monthly Payment Formula
Where:
- M = Monthly Payment
- P = Principal Loan Amount
- i = Monthly Interest Rate (Annual Rate / 12)
- n = Total Number of Payments (Loan Term in Years × 12)
Common Loan Types
| Loan Type | Description |
|---|---|
| Mortgage Loan | Used to purchase real estate, secured by the property itself. |
| Auto Loan | Used to finance the purchase of a vehicle, secured by the vehicle. |
| Personal Loan | Unsecured loan for various personal expenses, often with fixed interest rates. |
| Student Loan | Designed to help students pay for post-secondary education and the associated fees. |
| Business Loan | Provided to businesses for various purposes, such as starting, expanding, or managing operations. |
Frequently Asked Questions
What is a loan calculator?
A loan calculator helps you determine your potential monthly loan payments, total interest paid, and the overall cost of a loan based on the principal amount, interest rate, and loan term.
How is the monthly loan payment calculated?
The monthly payment (M) is typically calculated using the formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1], where P is the principal loan amount, i is the monthly interest rate (annual rate / 12), and n is the total number of payments (loan term in years × 12).
What is an amortization schedule?
An amortization schedule is a table detailing each periodic loan payment, showing how much of the payment is applied to interest and how much to the principal balance, until the loan is paid off. It illustrates how the interest portion decreases and the principal portion increases over time.