Finance
Loan Payment Calculator
Calculate the monthly payment on a fixed-rate business or personal loan, plus the total interest and total repaid over the term. Free, instant, no signup.
Enter the loan amount, interest rate, and term to see your monthly payment.
All calculations happen in your browser. Nothing is stored. This is an estimate — your lender's terms and fees may differ.
✳ Free · No signup · Runs in your browser — we never store your numbers
Small business guide
What this tool helps you do
Use this free loan payment calculator to see exactly what a fixed-rate loan will cost you: the monthly payment, the total interest, and the total amount repaid over the life of the loan. It is built for small business owners weighing equipment financing, a working-capital loan, or any fixed-rate borrowing.
A monthly payment number on its own hides the real cost. The same $10,000 can cost a few hundred dollars in interest or a few thousand depending on the rate and term. This tool shows all of it up front so you can compare offers on total cost, not just the monthly figure.
How to use this tool
- 1
Enter the loan amount — the principal you plan to borrow.
- 2
Enter the annual interest rate (APR) the lender is quoting.
- 3
Enter the loan term in years. The calculator converts this to monthly payments automatically.
- 4
Read the monthly payment first, then the total interest — that is the true price of borrowing.
Formula
Monthly payment = P × r(1 + r)ⁿ ÷ ((1 + r)ⁿ − 1), where P is the principal, r is the monthly interest rate (annual rate ÷ 12), and n is the number of monthly payments (years × 12). Total interest = (monthly payment × n) − principal.
- The monthly rate is the annual rate divided by 12; a 6% APR is 0.5% per month.
- A longer term lowers the monthly payment but raises the total interest — you pay more overall to pay less each month.
- At a 0% rate the payment is simply the principal divided by the number of months.
- This assumes a fully amortizing, fixed-rate loan with equal monthly payments and no fees. Origination fees and variable rates change the real cost.
Examples
Equipment loan
A shop finances a $10,000 piece of equipment at 6% APR over 5 years.
Inputs
- Loan amount: $10,000
- Interest rate: 6%
- Term: 5 years
Result
The monthly payment is about $193.33, and total interest over the loan is about $1,599.68 — a total repaid of $11,599.68.
The equipment effectively costs $11,600, not $10,000. Factor that interest into whether the purchase pays for itself.
Same loan, longer term
The same $10,000 at 6% stretched to 7 years to lower the monthly payment.
Inputs
- Loan amount: $10,000
- Interest rate: 6%
- Term: 7 years
Result
The monthly payment drops to roughly $146, but total interest climbs to about $2,271.
Extending the term cut the monthly payment by about $47 but added roughly $670 in interest. Cheaper per month, more expensive overall.
Key terms
Principal
The amount you borrow, before any interest. It is the starting balance the payments pay down.
APR (annual percentage rate)
The yearly interest rate on the loan. Divided by 12, it becomes the monthly rate used to calculate each payment.
Amortization
The process of paying off a loan with equal payments over time, where early payments are mostly interest and later payments are mostly principal.
How to interpret the result
Compare offers on total cost, not just the monthly payment
A lower monthly payment often means a longer term and more total interest. Use total repaid as the apples-to-apples comparison between loan offers.
Interest is the price of time
The longer you take to repay, the more interest accrues. If cash flow allows, a shorter term or extra principal payments can save a meaningful amount over the life of the loan.
Common mistakes
- Comparing loans only by the monthly payment and ignoring the total interest.
- Forgetting origination fees, which raise the real cost above what this calculator shows.
- Assuming a variable-rate loan will stay at today's rate — this tool models fixed rates only.
- Choosing the longest term for the lowest payment without seeing how much extra interest that adds.
Frequently asked questions
How is a monthly loan payment calculated?+
It uses the amortization formula: the principal times the monthly rate times (1 + monthly rate) to the power of the number of payments, divided by that same power minus one. This calculator does the math for you from the amount, rate, and term.
What is the difference between the monthly payment and total interest?+
The monthly payment is what you pay each month; total interest is everything you pay on top of the principal over the whole loan. A low monthly payment can still carry high total interest if the term is long.
Does this calculator include fees?+
No. It shows principal and interest only. Origination fees, insurance, and other charges add to the real cost, so ask your lender for the full figure.
How can I pay less interest?+
Choose a shorter term, secure a lower rate, or make extra payments toward the principal. Each reduces the total interest you pay over the life of the loan.
Does it work for business and personal loans?+
Yes. Any fully amortizing fixed-rate loan — equipment financing, a business term loan, a personal loan, or a car loan — follows the same math this calculator uses.