How is the monthly payment calculated?

The calculator 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, and n is the total number of payments. This gives you a fixed monthly payment that covers both principal and interest.

How do extra payments reduce my loan?

Extra payments go directly toward reducing the principal balance. Because interest is calculated on the remaining balance, a lower balance means less interest each month, which accelerates payoff. Even small extra payments can save thousands over the life of a loan.

Does this include taxes, insurance, or PMI?

No — this is a general-purpose loan calculator covering principal and interest only. For a home purchase you also need property tax, homeowner's insurance, HOA dues, and PMI when down payment is under 20% — use the Mortgage Calculator for that full PITI estimate.

What is amortization?

Amortization is the process of spreading a loan into a series of fixed payments over time. Early payments are mostly interest; later payments are mostly principal. The total payment stays the same, but the split between interest and principal changes each month.

Can I use this for car loans or personal loans?

Yes. The formula works for any fixed-rate, fully amortizing loan — mortgages, auto loans, personal loans, and student loans. Just enter the correct principal, rate, and term.

FINFinancial

Loan Calculator

Calculate monthly payments, total interest, and payoff timeline for any general loan — auto, personal, or student. Supports extra payments so you can see how much you save by paying ahead. For a home purchase with PMI and escrow, use the Mortgage Calculator.

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Loan Amount

Annual Interest Rate

Loan Term

years

Extra Monthly Payment(optional)

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How It Works

Formula

M = P \times \frac{r(1 + r)^{n}}{(1 + r)^{n} - 1}

Where

$M$: Fixed monthly payment
$P$: Loan principal (amount borrowed)
$r$: Monthly interest rate — annual rate divided by 12 × 100
$n$: Total number of monthly payments — years × 12

Enter your loan amount, annual interest rate, and loan term in years. Optionally add an extra monthly payment to see how it shortens your payoff. The calculator computes the fixed monthly payment from the standard amortization formula, then simulates the full repayment schedule month by month to account for extra payments.

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