Loan / Mortgage Calculator
Before signing a mortgage or taking out a personal loan, you should know exactly what you're committing to. Our Loan and Mortgage Calculator takes three inputs — the loan amount (principal), annual interest rate, and loan term in years — and instantly computes your fixed monthly payment, total interest paid over the life of the loan, and total cost (principal plus interest). It also generates a detailed yearly amortization schedule showing how each year's payments are split between principal repayment and interest charges, along with the remaining balance. This gives you a clear picture of how your debt decreases over time and how much of your money goes toward interest versus actually paying down the loan.
account_balance Loan Details
When should you use it?
- check_circle Homebuyers estimating monthly mortgage payments before making an offer on a property
- check_circle Borrowers comparing different loan terms (15-year vs 30-year) to see the interest cost tradeoff
- check_circle Car buyers calculating monthly payments for auto loans at different interest rates
- check_circle Financial planners showing clients the total cost of borrowing over a loan's lifetime
- check_circle Students estimating repayment amounts for education loans before borrowing
- check_circle Small business owners evaluating the affordability of equipment or expansion loans
How it works
The calculator uses the standard fixed-rate amortization formula used by banks and lenders worldwide: M = P × [r(1+r)^n] / [(1+r)^n – 1], where P is the loan principal, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments (years multiplied by 12). This formula produces the fixed monthly payment amount that will fully repay the loan by the end of the term.
The amortization schedule is built by simulating every month of the loan. Each month, the interest charge is calculated as the remaining balance multiplied by the monthly rate. The principal portion of that month's payment is the total payment minus the interest charge. The remaining balance is then reduced by the principal portion. This process repeats for every month, and the results are aggregated into yearly summaries showing total principal paid, total interest paid, and end-of-year balance.
For zero-interest loans (0% APR), the formula simplifies to principal divided by the number of months, since there is no interest component. The calculator detects this special case and handles it correctly, avoiding the division-by-zero issue that the standard formula would produce with a zero rate.
Frequently Asked Questions
Related tools
How to use
Enter the loan amount, interest rate, and term to calculate your monthly payment and see a yearly breakdown.
Uses the standard amortization formula.
- check_circle Monthly payment calculation
- check_circle Total interest and total cost
- check_circle Yearly amortization schedule