Finance

Loan Payment Calculator

Estimate the fixed periodic payment on an amortizing loan using principal, interest rate, and term length.

Last reviewed: April 30, 2026Free toolMethodology

Loan Payment Calculator

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These fields start with sample inputs. Keep them or replace them, then run the tool to show a fresh result.

Number fields accept plain values and common formatted input such as 250000, 250,000, or 1,234.56.

Result

Calculating the sample result.

Why it matters

Loan payment estimates help borrowers compare scenarios quickly before they spend time on a full lender workflow.

When to use

  • Comparing loan sizes or repayment terms
  • Stress-testing affordability before applying
  • Checking the payment effect of rate changes

Inputs & Outputs

Inputs

  • Loan amount is the starting principal balance.
  • Annual interest rate is the nominal yearly rate before compounding frequency is applied.
  • Loan term is the total repayment period in years.

Outputs

  • Monthly payment is the fixed installment under a standard amortizing schedule.
  • Total paid and total interest show the long-run cost of the loan if held to maturity.

Amortizing payment formula

Convert the annual rate to a monthly rate, calculate the total number of payments, then apply the standard annuity formula for a fixed-payment loan.

Payment = P x r x (1 + r)^n / ((1 + r)^n - 1)

Worked example

1

Term comparison

A borrower finances 250,000 at 6.5% for 30 years.

Inputs

  • Loan amount: 250,000
  • Rate: 6.5%
  • Term: 30 years

Steps

  • Monthly rate = 6.5% / 12
  • Payments = 30 x 12 = 360
  • Apply the amortization formula

Result

  • The estimated monthly payment is about 1,580.17 before taxes, insurance, or fees.

Edge cases & caveats

  • This calculator models principal and interest only.
  • Taxes, insurance, origination fees, and prepayments are not included.

Frequently Asked Questions

Why does a longer loan term reduce the monthly payment?

Because the principal is spread across more installments, though the total interest paid usually rises.

Can I use this for business equipment loans?

Yes. The amortization math is the same for many fixed-payment loans as long as the payment schedule is regular.

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