Loan Calculator
Calculate your monthly loan payment, total interest, and total cost. Enter your loan details to see a complete payment breakdown with visual charts.
Monthly Payment
$1,264
Loan Principal
$200,000
Total Interest
$255,089
Total Cost
$455,089
Payment Breakdown
Principal
$200,000
Interest
$255,089
How to Use
- Enter the total loan amount (e.g., home price, car price).
- Enter your down payment amount, if any.
- Set the annual interest rate and loan term in years.
- View your monthly payment, total interest, total cost, and a pie chart showing the principal vs. interest breakdown.
Frequently Asked Questions
How is the monthly payment calculated?
Monthly payments are calculated using the standard amortization formula: M = P[r(1+r)^n] / [(1+r)^n - 1], where P is the loan principal, r is the monthly interest rate, and n is the total number of payments. This formula ensures equal monthly payments over the life of the loan.
How does the interest rate affect my payments?
Even small changes in interest rate can significantly impact your total cost. For example, on a $200,000 30-year mortgage, the difference between 6% and 7% is about $133 more per month and over $47,000 more in total interest. Always shop around for the best rate.
Should I make a larger down payment?
A larger down payment reduces your loan principal, which lowers both your monthly payment and total interest paid. For mortgages, putting 20% or more down also helps you avoid private mortgage insurance (PMI). However, consider keeping emergency savings available.
What loan term should I choose?
Shorter terms (e.g., 15 years vs. 30 years) have higher monthly payments but much lower total interest. A 15-year mortgage at the same rate saves tens of thousands in interest compared to a 30-year term. Choose based on what monthly payment fits your budget.