How to use it
- Enter the loan amount you plan to borrow.
- Input the annual interest rate as a percentage.
- Select the loan term in years and hit calculate.
What it does – The calculator takes your loan amount, annual interest rate and term to show three key figures: the monthly payment you’ll owe, the total interest you’ll pay over the life of the loan, and the sum of all payments. Why it matters – Knowing the monthly payment helps you budget, while total interest reveals the cost of borrowing. How to read it – The monthly payment is the amount due each month. The total interest is the extra money over the principal. The total of payments is simply principal plus interest. Use these numbers to compare loan offers, plan cash flow, or decide if a shorter term saves enough interest to justify higher payments.
Pro tips
- Add a small buffer to cover rounding differences
- Enter the exact loan amount before fees
- Use the same term units you plan to borrow
- Double‑check the interest rate format (percentage not decimal)
Real-life examples
- First‑time homebuyer comparing two 30‑year offers
- Refinance planning to see monthly savings
- Investor evaluating cash flow on a rental property loan
Case study
Sara entered a $250,000 loan, 4% rate and 30‑year term; the calculator showed a $1,200 monthly payment, $180,000 total interest and $430,000 total cost, letting her decide to refinance and lower her payment by $150.