Personal Loan Calculator
Calculate monthly payments for personal loans.
Input
Monthly Payment
Understanding Personal Loan Costs
Overview
Personal loans are unsecured installment loans — no collateral required, fixed monthly payments, fixed term (usually 1–7 years). They typically carry higher rates than auto or mortgage loans (because no collateral) but lower than credit cards. Common uses: consolidating credit card debt, home improvements, medical bills, weddings, large purchases. This calculator shows your monthly payment, total interest, total cost, and amortization schedule — so you understand the full cost before signing.
How It Works
Standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where M = monthly payment, P = loan principal, r = monthly interest rate (annual rate ÷ 12), n = number of payments (years × 12). The calculator iterates through each month, computing interest first (current balance × monthly rate), then principal (payment − interest), then new balance. The amortization table shows this month-by-month — early payments are mostly interest, later payments mostly principal.
When to Use This
Comparing loan offers from different lenders (same principal, different rates → wildly different total cost). Deciding loan term (shorter = higher payment but less total interest). Evaluating debt consolidation (does the new rate beat your credit card APR? Yes most of the time — credit cards average 18–25%, personal loans 8–15% for good credit). Pre-approving for a major purchase. Checking if your current loan terms are competitive.
Frequently Asked Questions
660+ typically qualifies; 720+ gets the best rates (7–11% APR in normal times). Below 600 may not qualify or face rates of 25%+. Improving credit by 50 points can save thousands of dollars on the same loan.
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Understanding Personal Loan Costs
Overview
Personal loans are unsecured installment loans — no collateral required, fixed monthly payments, fixed term (usually 1–7 years). They typically carry higher rates than auto or mortgage loans (because no collateral) but lower than credit cards. Common uses: consolidating credit card debt, home improvements, medical bills, weddings, large purchases. This calculator shows your monthly payment, total interest, total cost, and amortization schedule — so you understand the full cost before signing.
How It Works
Standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where M = monthly payment, P = loan principal, r = monthly interest rate (annual rate ÷ 12), n = number of payments (years × 12). The calculator iterates through each month, computing interest first (current balance × monthly rate), then principal (payment − interest), then new balance. The amortization table shows this month-by-month — early payments are mostly interest, later payments mostly principal.
When to Use This
Comparing loan offers from different lenders (same principal, different rates → wildly different total cost). Deciding loan term (shorter = higher payment but less total interest). Evaluating debt consolidation (does the new rate beat your credit card APR? Yes most of the time — credit cards average 18–25%, personal loans 8–15% for good credit). Pre-approving for a major purchase. Checking if your current loan terms are competitive.
Frequently Asked Questions
660+ typically qualifies; 720+ gets the best rates (7–11% APR in normal times). Below 600 may not qualify or face rates of 25%+. Improving credit by 50 points can save thousands of dollars on the same loan.