Find out what a personal loan will actually cost you: your monthly payment, the total interest over the life of the loan, and how much you'll pay back in total.
A personal loan is typically repaid through equal monthly installments that combine principal and interest, known as amortization. Early payments are weighted more toward interest, and later payments are weighted more toward principal, even though the payment amount itself stays constant.
This calculator uses the standard amortization formula: M = P × [r(1 + r)n] / [(1 + r)n − 1]. Here P is the amount borrowed, r is the monthly interest rate (the annual rate divided by 12), and n is the number of monthly payments. The result is a fixed monthly payment that fully pays off the loan by the end of the term. The tool also shows how the very first payment splits between interest and principal, so you can see amortization at work.
Enter an origination fee in the optional field and the calculator estimates your APR, assuming the fee is deducted from the amount you receive. Some lenders add the fee to the balance instead, which changes the math slightly, so treat the APR as an estimate.
Three factors drive your total cost: the amount you borrow, the interest rate you're offered, and the length of the term. A longer term lowers your monthly payment but increases the total interest you pay, since the balance takes longer to shrink. A shorter term does the opposite.
Your interest rate is influenced by your credit profile, the lender, and whether the loan is secured or unsecured. Comparing offers from multiple lenders before signing can meaningfully change your total cost. For a home loan, use the Mortgage Calculator, which also includes property tax, insurance, and PMI. For a vehicle, try the auto loan calculator.
With the default numbers above, a $10,000 loan at 9.5% over 36 months, the monthly payment comes out to $320.33. Over the life of the loan you'll pay $1,531.86 in total interest, bringing your total repayment to $11,531.86, about 15% more than you borrowed.
Your first payment shows why early payments feel slow. Of that $320.33, $79.17 goes to interest and only $241.16 to principal. Because interest is charged on the remaining balance, the interest share shrinks a little with every payment while the principal share grows.
Here is how the term changes a $10,000 loan at 9.5%:
Stretching from 36 to 60 months lowers the payment by about $110 a month but adds roughly $1,069 in interest. Choose the shortest term whose payment fits comfortably in your budget.
Take the same loan with a 5% origination fee. The fee is $500, so you receive $9,500 but still repay the full $10,000 with interest. The estimated APR is about 13.05%, well above the 9.5% interest rate.
Here is why APR matters when you compare offers. Suppose lender A offers $10,000 over 36 months at 9.5% with no fee, and lender B offers 8.0% with a 6% fee. Lender B's payment is lower, $313.36 versus $320.33, and its interest is lower too, $1,281.09 versus $1,531.86. But B's $600 fee brings its total cost to $1,881.09, which is $349.23 more than lender A, and its APR is about 12.26% compared with 9.50%. The lower rate looked better, but the fee made it the more expensive loan.
Any extra amount goes straight to principal, which reduces the interest charged on later payments. On the default loan, an extra $50 a month pays it off in 31 months instead of 36 and saves about $236 in interest. An extra $100 a month pays it off in 27 months and saves about $408. Use the optional extra payment field to test your own amount.
Before you start, confirm that your loan has no prepayment penalty and ask that extra payments be applied to principal.
A common use of personal loans is consolidating credit card debt into one fixed payment, ideally at a lower rate than your cards charge. To compare the numbers, work out your card payoff timeline with the credit card payoff calculator, then check whether the loan's APR, including any fee, actually beats the rate you are paying now. Lenders will also look at your monthly obligations relative to your income, which you can check with the debt-to-income calculator.
Does this include fees like origination charges?
Yes, if you enter one. Add the fee as a percentage in the optional field and the calculator shows the fee, the amount you receive, and an estimated APR. The monthly payment and total interest still reflect the full loan amount, because that is what you repay. Check your loan's APR, not just its interest rate, for the fullest picture of cost.
What's a good interest rate for a personal loan?
Rates vary widely by credit score, lender, and country, so there's no single "good" number. Comparing the APR across a few lenders for the same loan amount and term is the most reliable way to judge an offer.
Can I pay off a personal loan early?
Many lenders allow early payoff, which reduces total interest since less time accrues charges. Some loans include a prepayment penalty, so it's worth checking your specific loan agreement. The optional extra payment field shows how much sooner you would finish and how much interest you would save.
Does a longer term always cost more in total interest?
At the same interest rate, yes. More months means more time for interest to accrue on the remaining balance. The only way a longer term reduces total interest is if it comes paired with a meaningfully lower rate, which isn't typical for personal loans.
How is a personal loan different from a credit card?
A personal loan has a fixed rate, a fixed monthly payment, and a set payoff date, while credit card balances carry a variable rate and can be paid down slowly with no fixed end date. Personal loans are often used to consolidate credit card debt at a lower, predictable rate.
What's the difference between APR and interest rate?
The interest rate only reflects the cost of borrowing the principal. APR (annual percentage rate) rolls in the interest rate plus most fees, like origination charges, into a single yearly percentage, making it a more complete way to compare offers from different lenders.
How does my credit score affect the rate I get?
Lenders price loans by risk, so a higher credit score usually means a lower interest rate and lower fees, while a lower score means a higher rate or a smaller approved amount. Even a difference of a few percentage points changes your total interest noticeably, so it can pay to improve your score before applying.
Will applying for a personal loan hurt my credit score?
It can, slightly and temporarily. Checking your rate through prequalification usually uses a soft inquiry, which does not affect your score. A formal application typically triggers a hard inquiry, which can lower your score by a few points for a short time.