Loan Interest Calculator
Calculate monthly loan repayments, total borrowing interest costs, and amortization schedules for mortgages, auto financing, and personal bank loans.
Step-by-Step Usage Guide
Estimate loan payments and borrowing interest in three simple steps:
Enter the principal borrowing amount and nominal annual interest rate.
Choose your repayment duration in years and select Amortized or Interest-Only.
Click calculate to view monthly debt service and cumulative lifetime interest.
Amortized vs. Interest-Only Loans
Standard Amortized Loans split each monthly payment between principal reduction and accrued interest, steadily lowering the outstanding balance over the loan term.
Interest-Only Loans require payments covering only the monthly interest charges during an introductory period, keeping payments low initially while leaving the principal balance unchanged.
Financing Categories Overview
- Fixed-Rate Mortgages: Extended 15-to-30-year borrowing terms with predictable interest structures.
- Auto Financing: Short-term 3-to-7-year amortized loans for vehicle purchases.
- Personal Loans: Unsecured fixed-term financing commonly used for debt consolidation and home improvements.
Loan Term & Interest Cost Comparison ($100,000 at 6.0% APR)
| Loan Duration | Repayment Model | Monthly Payment | Total Interest Paid |
|---|---|---|---|
| 5 Years (Auto/Personal) | Fully Amortized | $1,933.28 | $15,996.80 |
| 15 Years (Mortgage) | Fully Amortized | $843.86 | $51,894.80 |
| 30 Years (Mortgage) | Fully Amortized | $599.55 | $115,838.00 |
| 10 Years (Interest-Only) | Interest Only | $500.00 | $60,000.00 (Principal Remains) |
Frequently Asked Questions
How is monthly interest calculated on a loan?
Monthly interest is calculated by dividing the annual interest rate by 12 and multiplying the resulting decimal by the remaining loan principal balance ($I = P \times \frac{r}{12}$).
How does amortization reduce total interest over time?
Because each amortized payment pays down a portion of the loan principal, the base balance on which future interest is calculated shrinks each month, steadily reducing interest costs over the life of the loan.
Are my financial entries stored or tracked?
No. All calculations run strictly in your web browser’s local JavaScript runtime. No financial figures, loan amounts, or personal entries are transmitted to or stored on external servers.