Personal Loan Calculator

The payment is the rent. The total is the price.

Most personal loan offers lead with a monthly payment. The payment matters for your budget, but it is not the cost of the loan. The cost is everything you repay above the amount you borrowed: the interest over the full term plus any fees the agreement adds. A loan can look cheaper every month and cost more in total, simply because you pay interest for more months. This calculator shows both numbers together so you can see that trade before you sign.

Enter the amount, the rate, and the term in months above. Try the same amount at two different terms. The shorter term will show a higher monthly payment and a lower total interest figure. The longer term will show the reverse. Neither result is automatically the right choice. The right choice is the shortest term whose payment still fits your budget with room for other bills, savings, and the uneven months every household has.

Personal loans are usually unsecured, which means no house or car stands behind the promise to repay. The lender prices that risk into the rate and the fees. That is why two offers for the same amount can differ so much, and why the comparison on this page uses total repaid and APR, not the advertised payment alone.

APR versus interest rate, and where fees hide

The interest rate is the percentage charged on what you owe. The APR, short for annual percentage rate, states the yearly cost with the interest rate and certain lender fees counted together. If two offers have the same interest rate but one charges an origination fee, the offer with the fee has the higher APR and the higher real cost. That is why rate alone cannot rank offers. Rank them by APR and by total amount repaid.

An origination fee is a charge for setting up the loan. The agreement may deduct it from the money sent to you, or add it to your balance. Either method raises the cost. Consider a clearly hypothetical illustration. You agree to a $10,000 loan and the lender deducts a hypothetical $300 fee before sending funds. You receive $9,700, but your payment is calculated on $10,000 and you repay $10,000 plus interest. You paid interest on money you never held. If the same hypothetical $300 fee were added to the balance instead, you would owe $10,300 from the first day. The fee in this paragraph is invented for the illustration only. It is not a typical fee, a market figure, or a quote. Your agreement states your actual fee, so read that line and enter the full amount you will owe into the calculator.

Fixed versus variable, secured versus unsecured

A fixed rate does not change during the term. Your payment is set on day one and the total interest can be calculated in advance, which is what the calculator above assumes. A variable rate can move when its reference rate moves. The starting payment may be lower, but a higher future rate raises the payment and the total. Only choose a variable rate if the budget still works after an increase and you understand the adjustment schedule in the agreement.

A secured loan is backed by property, such as a car or a house, which the lender can claim if you default. An unsecured loan has no property behind it and rests on your promise and credit history. Personal loans are commonly unsecured. Because the lender has no property to claim, unsecured credit usually costs more than secured credit for the same borrower. The calculator does not need to know which type you have. The amount, rate, term, and fees decide the cost either way.

Common mistakes with personal loans

1. Shopping by monthly payment alone. A longer term lowers the payment and raises the total. In the worked example, five years costs $1,889 more in interest than three years on the same $15,000.
2. Comparing interest rates instead of APRs. Fees sit outside the rate. Two offers with the same rate can have different APRs and different totals repaid.
3. Skipping the fee method. A fee deducted from your funds and a fee added to your balance both raise the cost, in different ways. Find which method your agreement uses and the dollar amount.
4. Taking the longest term offered. The longest term gives the smallest payment and the largest interest bill. Choose the shortest term your budget can carry, not the longest term the lender will grant.
5. Ignoring the prepayment clause. Extra payments save interest only if the agreement allows them without a penalty. Check the clause before you count on an early payoff.
6. Consolidating cards and then using them again. The loan pays the cards, the freed balances invite new spending, and you end up with the loan payment plus new card debt. The consolidation failed even though the loan performed as agreed.
7. Borrowing the full approved amount. Approval is a ceiling, not a target. Every extra dollar borrowed adds interest for the full term. Borrow the amount the job requires.

How to choose a personal loan you will not regret

Start with the purpose and the amount. A loan for a defined cost, such as consolidating existing card balances or paying a necessary bill, is easier to size than a loan for general spending. Enter that amount in the calculator. Then test two terms, one you are sure you can afford and one shorter. Compare the total interest figures, not just the payments. If the shorter term saves a large amount and the payment still leaves room for rent, food, transport, and savings, the shorter term is usually the stronger choice.

Next, collect the fee and penalty facts for each offer. Write down the origination fee in dollars, whether it is deducted or added, the APR, and whether a prepayment penalty exists. Add the fees to the total interest from the calculator to get the total cost of credit for each offer. The offer with the lowest total cost that fits your monthly budget is the offer to take. If no offer fits, the honest answer is to borrow less, wait, or choose a different way to cover the cost.

If you use the loan to consolidate card debt, treat the loan as only half the plan. Close or lock the paid-off cards so the balances cannot quietly return. Set the loan payment on automatic payment for the day after payday. Check your total debt, loan plus cards, once a month. The total should fall every month. If it stops falling, spending has restarted somewhere, and fixing that matters more than the rate you negotiated.