Loan Repayment Calculator
Loan Repayment Calculator. Compare Fixed Payment, Equal Principal, and Interest-Only methods. Features grace period, early repayment savings, amortization schedule, Excel export, and affordability calculator.
Enter loan details to calculate your payment
- Enter loan amount, interest rate, and term
- Monthly payment varies by repayment method
- Grace period reduces initial burden
- Use affordability mode to check max loan amount
| Month | Interest | Principal | Payment | Balance |
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This calculator is for reference only. Please consult your financial institution for actual loan terms.
What is a Loan Repayment Calculator?
A loan repayment calculator is a tool that helps you estimate your monthly loan payments, total interest costs, and repayment schedule before taking out a loan. It’s useful for mortgages, auto loans, student loans, personal loans, and any other type of installment loan.
This calculator supports three repayment methods: Fixed Payment (Principal & Interest), Equal Principal, and Interest Only. It also includes grace period settings, early repayment calculations, and an affordability calculator to determine your maximum loan amount.
Types of Repayment Methods
1. Fixed Payment (Principal & Interest)
With this method, you pay the same monthly amount throughout the loan term. The payment combines principal and interest, making budgeting easier. Early payments have more interest and less principal; as time goes on, more of each payment goes toward principal.
- Pros: Predictable monthly payments make budgeting simple
- Cons: Higher total interest compared to equal principal
- Best for: Borrowers who want consistent monthly payments
2. Equal Principal
Each month, you pay the same principal amount, plus interest on the remaining balance. Since the balance decreases over time, monthly payments gradually decrease (declining payment structure).
- Pros: Lowest total interest cost
- Cons: Higher initial monthly payments
- Best for: Borrowers with strong cash flow who want to minimize interest
3. Interest Only
During the loan term, you pay only interest, then repay the entire principal at maturity. Monthly burden is lowest, but total interest is highest.
- Pros: Lowest monthly payment
- Cons: Highest total interest; requires lump sum at maturity
- Best for: Short-term loans or when expecting a lump sum payment
Key Features
- Compare 3 Repayment Methods: See fixed payment, equal principal, and interest-only side-by-side
- Grace Period Setting: Model interest-only periods at the start of the loan
- Monthly Amortization Schedule: View detailed payment breakdown for the entire loan term
- Early Repayment Calculator: Estimate interest savings from prepayments
- Visual Chart: See how principal and interest portions change over time
- Affordability Calculator: Determine maximum loan amount based on your monthly budget
- URL Sharing: Save and share your calculation results
How to Use
- Enter Loan Amount: Input the amount you want to borrow (quick buttons available)
- Enter Interest Rate: Input the annual percentage rate (e.g., 6.5%)
- Set Loan Term: Enter years and additional months
- Select Repayment Method: Choose from fixed payment, equal principal, or interest only
- Set Grace Period (Optional): Enable if you have an interest-only period
- Review Results: Check monthly payment, total interest, and amortization schedule
Affordability Mode: Switch to the “Affordability Calculator” tab to calculate your maximum loan amount based on your monthly budget.
Calculation Formulas
Fixed Payment (Principal & Interest)
Monthly Payment = P × r × (1+r)ⁿ / ((1+r)ⁿ – 1)
- P: Loan principal
- r: Monthly interest rate (annual rate ÷ 12)
- n: Total number of months
Equal Principal
Monthly Payment = (P ÷ n) + (Remaining Balance × r)
- Monthly principal: P ÷ n (fixed)
- Monthly interest: Remaining balance × r (decreases over time)
Interest Only
Monthly Payment = P × r (interest only)
At maturity: Pay entire principal P
Loan Repayment Tips
- To Save Interest: Choose equal principal method. It has the lowest total interest cost.
- To Reduce Monthly Burden: Fixed payment has lower initial payments than equal principal.
- Use Early Repayment: Making prepayments can significantly reduce your total interest cost.
- Grace Period Caution: While grace periods reduce initial burden, they increase total interest.
- Compare APRs: Shop around for the best interest rate and consider all fees and PMI requirements.
- 20% Down for Mortgages: Putting 20% down avoids PMI (Private Mortgage Insurance) and reduces interest.
- Consider Refinancing: If rates drop significantly, refinancing can save thousands in interest.
Frequently Asked Questions
Which is better: fixed payment or equal principal?
To minimize total interest, equal principal is better. However, it has higher initial payments. If you need predictable monthly budgeting, fixed payment is more convenient. Choose based on your financial situation and cash flow.
What is a grace period?
A grace period is an initial period where you pay only interest, with no principal repayment. It reduces your initial payment burden but increases total interest since the principal doesn’t decrease during this time. Common in mortgage loans.
How much can I save with early repayment?
You save the interest that would have accrued on the prepaid amount over the remaining loan term. For example, prepaying $10,000 ten years early saves ten years of interest on that $10,000. Note that some loans charge prepayment penalties—check your loan terms.
How does the affordability calculator work?
Switch to the “Affordability Calculator” tab and enter your monthly budget. The calculator works backward to determine your maximum loan amount. For example, with a $3,000 monthly budget at 6.5% APR over 30 years, you can borrow approximately $475,000.
Can actual loan amounts differ from this calculator?
Yes. This calculator uses standard interest formulas. Actual loans may vary based on loan origination date, interest calculation method, fees, PMI, and special rate conditions. Always consult your lender for exact terms and payment amounts.