Personal Loan Calculator

Personal Loan Calculator

This calculator computes your monthly payment, total interest paid, and total cost for any personal loan. Enter the loan amount, interest rate, and term to compare different scenarios and understand exactly what a personal loan will cost you before you apply.

How Personal Loan Payments Are Calculated

The monthly payment uses the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n - 1], where P is the principal, r is the monthly interest rate (annual rate / 12), and n is the total number of months.

• Total Cost = Monthly Payment x Number of Months
• Total Interest = Total Cost - Principal

At higher interest rates, a larger portion of each early payment goes toward interest rather than principal, which is why shorter loan terms save significant money.

Example

Key Factors That Affect Your Personal Loan

• Credit score — borrowers with scores above 720 qualify for rates 5-8%, while scores below 640 may face 20%+
• Loan term — shorter terms mean higher monthly payments but much less total interest
• Loan amount — larger loans may qualify for lower rates but carry more total interest over time
• Debt-to-income ratio — lenders prefer a DTI below 36%; higher ratios may mean higher rates or denial
• Lender type — credit unions, online lenders, and banks offer significantly different rates for the same borrower

Tips

1. Choose the shortest term you can comfortably afford, since going from 60 months to 36 months on a $15,000 loan saves roughly $1,800 in interest
2. Get pre-qualified with multiple lenders before applying, as rate shopping within a 14-day window counts as a single credit inquiry
3. Avoid rates above 20%; at that level, a 0% intro APR credit card or credit union loan is almost always cheaper
4. Use this calculator to compare a personal loan against a balance transfer card or home equity loan to find the lowest total cost