Personal Loan Calculator

What is a personal loan?

A personal loan is a fixed amount you borrow and repay in equal monthly payments over a set term, usually two to seven years. Most personal loans are unsecured, meaning no car or home backs the loan, so the interest rate depends mainly on your credit score, income, and existing debt. People commonly use them to consolidate credit card debt, cover medical bills, or pay for home repairs.

How this personal loan calculator works

The personal loan payment calculator uses the standard formula for a fixed-rate loan with monthly payments:

Monthly payment = P × r ÷ (1 − (1 + r)⁻ⁿ)

P is the loan amount, r is the monthly interest rate (the annual rate divided by 12), and n is the number of monthly payments, so the term must come to a whole number of months. Total interest is the monthly payment times n, minus the loan amount. The amortization schedule shows how each payment splits between interest and principal, starting from the month you choose.

Origination fees, insurance, and APR

Many lenders charge an origination fee, often 1% to 10% of the loan. It is usually taken out of the loan before the money reaches you, so a $20,000 loan with a 5% fee puts $19,000 in your account while you still repay the full $20,000. Some lenders have you pay the fee separately instead, in which case you receive the full amount.

The annual percentage rate (APR) folds those extra costs into one yearly rate so you can compare offers. The calculator finds the rate at which your monthly payments, including any insurance, are worth exactly the loan amount minus the origination fee:

Loan amount − fee = (payment + insurance) × (1 − (1 + APR ÷ 12)⁻ⁿ) ÷ (APR ÷ 12)

With no fee and no insurance the APR equals the interest rate. How you pay the fee changes only the cash you receive, not the APR. Deducting it from the loan or paying it upfront raises the APR by the same amount, because either way it is money you pay to borrow.

The total cost of the loan is the interest plus the origination fee plus all insurance payments.

Frequently asked questions

What is the monthly payment on a $20,000 personal loan?

At a 10% interest rate over 5 years, the payment is $424.94 a month. You repay $25,496.45 in total, of which $5,496.45 is interest. Over 3 years at the same rate the payment rises to $645.34, but total interest falls to $3,232.37.

What is the difference between interest rate and APR on a personal loan?

The interest rate sets your monthly payment. The APR also counts fees. A $20,000, 5-year loan at 10% with a 5% origination fee has an APR of 12.239%, so it costs about the same as a no-fee loan at 12.239%.

Should I pick the loan with the lowest interest rate?

Compare APRs for loans with the same term, not interest rates. A loan with a lower rate but a large origination fee can cost more than a loan with a slightly higher rate and no fee.

How do I get the full amount I need if the fee is deducted?

Borrow more. Divide the cash you need by (1 − fee rate). To receive $20,000 with a 5% fee, borrow 20,000 ÷ 0.95 = $21,052.63.

Limitations

This is an estimate for a fixed-rate loan with equal monthly payments. It does not cover variable rates, late or prepayment fees, or extra payments. It counts every insurance payment you enter toward the APR, while a lender's disclosed APR may leave out insurance that is optional, so your loan documents can show a slightly different figure. It is not financial advice.