Money calculators · Updated September 3, 2026
Loan Payment Calculator
Get the monthly payment for any fixed-rate loan, the total interest over its life, and a year-by-year table of how each payment splits between interest and principal.
| Year | Payments | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | $6,155 | $4,191 | $1,964 | $20,809 |
| 2 | $6,155 | $4,561 | $1,594 | $16,248 |
| 3 | $6,155 | $4,964 | $1,191 | $11,284 |
| 4 | $6,155 | $5,403 | $752 | $5,881 |
| 5 | $6,155 | $5,881 | $274 | $0 |
The amortization formula
payment = P × r ÷ (1 − (1 + r)^−n) P = amount, r = APR ÷ 12, n = months each month: interest = balance × r; principal = payment − interest; balance −= principal
The formula assumes a fixed rate and equal monthly payments. Lenders round to the cent each month, so the final payment on a real loan is usually a few cents different.
Frequently asked questions
How is a loan payment calculated?
With the amortization formula: payment = P × r ÷ (1 − (1 + r)^−n), where P is the amount borrowed, r the monthly rate (APR ÷ 12) and n the number of months. Each payment covers that month's interest first; the rest reduces principal, so early payments are mostly interest.
What is the payment on a $25,000 loan?
At 8.5% APR over 60 months the payment is $512.91 and total interest is $5,774.80. A 36-month term raises the payment but cuts interest sharply; try it above.
What is the difference between APR and interest rate?
APR includes the interest rate plus most lender fees expressed as a yearly rate, which is why it is the number the Truth in Lending Act requires lenders to disclose. Use APR here for a fair comparison between offers.
Does paying extra reduce total interest?
Yes. Extra principal shortens the term and every month it removes accrues no interest. The mortgage payoff calculator models extra payments; the same logic applies to any amortized loan without prepayment penalties.
Why does the table show more interest in year one?
Because the balance is largest at the start. As principal falls, the interest portion of the fixed payment falls too, and the principal portion rises, which is what amortization means.
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Sources and updates
Figures are for tax year 2026 and were checked against the sources below on . Rates change every January; we review every data file at the start of each year and whenever a state announces a mid-year change.
This calculator gives estimates for information only and is not tax, legal or financial advice. Your employer's payroll system, local taxes, benefits and year-to-date wages can change the exact amounts on your pay stub. See how we calculate.