Personal Loan Calculator
Personal Loan Calculator
The Personal Loan Calculator helps borrowers evaluate the true cost of personal loans used for debt consolidation, home improvement, medical expenses, major purchases, and other needs. Personal loans are typically unsecured and have fixed interest rates and fixed monthly payments, making budgeting easier.
Understanding the true cost requires looking beyond the monthly payment. The APR includes both the interest rate and certain fees, providing a complete picture. Loan terms typically range from one to seven years. Shorter terms mean higher payments but less total interest. Longer terms mean lower payments but significantly more total interest.
Borrowers with excellent credit can often secure rates below 10 percent, while weaker credit may face rates exceeding 30 percent. Checking your credit score and shopping around with multiple lenders helps secure the best terms.
Enter the loan principal amount, annual interest rate, and loan term in years. If your loan has an origination fee, enter it as a percentage. The calculator will compute the true APR that accounts for these fees. Optionally enter extra monthly payments to see the impact on payoff time and interest savings.
For example, a $5,000 loan at 9 percent over 3 years has a $477 monthly payment and $2,170 total interest. The same loan over 5 years drops the payment to $311 but increases total interest to $3,660. A 3 percent origination fee increases the effective APR to approximately 11.5 percent.
Press Calculate to see monthly payment, total interest, total cost, APR including fees, and extra payment analysis.
The monthly payment uses the standard amortization formula:
When an origination fee is charged, the net loan amount is reduced. The APR accounts for this by finding the rate where the present value of payments equals the net amount received:
Total interest equals total payments minus original principal:
Monthly payment and total interest for a $10,000 personal loan:
| Rate | 2-Year Term | 3-Year Term | 5-Year Term |
|---|---|---|---|
| 6% | $443/mo, $634 int | $304/mo, $951 int | $193/mo, $1,600 int |
| 9% | $457/mo, $964 int | $318/mo, $1,448 int | $208/mo, $2,460 int |
| 12% | $471/mo, $1,299 int | $332/mo, $1,957 int | $222/mo, $3,347 int |
| 18% | $499/mo, $1,984 int | $361/mo, $3,009 int | $254/mo, $5,197 int |
Check your credit score before applying. Higher scores save thousands in interest. Consider steps to improve your score before applying, such as paying down credit cards and disputing credit report errors.
Shop around with 3-5 lenders and compare APRs. Many online lenders offer prequalification with a soft credit check. Credit unions often offer lower rates, especially for members with established relationships.
Consider total cost, not just the monthly payment. Choose the shortest term you can afford to minimize interest. A 2-4 year term balances affordability with reasonable total cost.
The calculator assumes a fixed interest rate. Most personal loans are fixed-rate, but variable-rate products exist. Fees beyond origination fees (late fees, prepayment penalties) are not modeled.
The impact of missed or late payments on your credit score is not included. Always borrow only what you can afford to repay.
- How is the monthly payment calculated?
- Using M = P x [i(1+i)^N] / [(1+i)^N - 1], where P is principal, i is monthly rate, N is total payments.
- What is APR and how does an origination fee affect it?
- APR includes interest rate plus fees. A 3% origination fee on a 9% loan raises the effective APR to approximately 11.5%.
- How does loan term affect total cost?
- Longer term = lower payment but more interest. A $10k loan at 9%: 2yr = $964 interest, 5yr = $2,460 interest.
- What credit score do I need for the best rates?
- Borrowers with 740+ can secure rates below 10%. Fair/poor credit may face rates exceeding 30%.
- What fees beyond interest should I watch for?
- Origination fees (1-8%), late payment fees, prepayment penalties, and annual fees. Read the loan agreement carefully.
- Consumer Financial Protection Bureau. "What Is a Personal Loan?" consumerfinance.gov.
- Federal Trade Commission. "Understanding Personal Loans." ftc.gov.
- Investopedia. "Personal Loan: Definition, Types, and How to Get One." investopedia.com.
- NerdWallet. "Personal Loan Calculator." nerdwallet.com.
- Bankrate. "Personal Loan Rates and Trends." bankrate.com.
Last updated: May 12, 2026