Loan Calculator
Fill in three of amount, rate, term and payment, and it works out the fourth, plus what the loan costs over its life.
Your question
The loan
Arrangement or origination fee, if it's financed. Leave 0 if none.
Your loan
$501 a month for 5 years: $25,000 borrowed, $5,057 in interest.
What you still owe
The balance year by year.
Year by year
Early payments are mostly interest; later ones mostly principal.
| Year | Principal paid | Interest paid | Balance at year end |
|---|---|---|---|
| 1 | $4,282 | $1,730 | $20,718 |
| 2 | $4,614 | $1,397 | $16,104 |
| 3 | $4,972 | $1,039 | $11,132 |
| 4 | $5,358 | $653 | $5,774 |
| 5 | $5,774 | $237 | $0 |
How it's calculated
A loan with a fixed payment follows one formula linking four numbers: the amount, the yearly rate, the number of months and the payment. Given any three, the fourth is fixed. The calculator solves for whichever one you ask about; for the rate it searches until the formula balances.
Each month, interest is charged on what's still owed, and the rest of the payment reduces the balance. That's why the first payments are mostly interest and the last ones mostly principal, and why paying extra early on saves the most.
When comparing offers, look at the total you pay back, not the monthly payment: a longer term makes the payment smaller and the loan dearer. A fee financed into the loan costs interest too, which is why it's added to the amount here.