Loan Calculator
Figure out your monthly loan payment, total interest, and payoff date — with a year-by-year breakdown of where every dollar goes.
Calculate
How much you're borrowing — the home price minus your down payment, for example.
The yearly rate your lender quotes (APR). A 30-year fixed mortgage might be around 6–7%.
How long you have to pay it back. Common choices: 15 or 30 years.
When the first payment is due — used to show your payoff date. Leave it for today.
| Year | Principal paid | Interest paid | Balance left |
|---|---|---|---|
| 1 | $3,353.18 | $19,401.27 | $296,646.82 |
| 2 | $3,577.74 | $19,176.70 | $293,069.08 |
| 3 | $3,817.35 | $18,937.10 | $289,251.73 |
| 4 | $4,073.01 | $18,681.44 | $285,178.72 |
| 5 | $4,345.79 | $18,408.66 | $280,832.93 |
| 6 | $4,636.83 | $18,117.62 | $276,196.10 |
| 7 | $4,947.37 | $17,807.08 | $271,248.73 |
| 8 | $5,278.70 | $17,475.75 | $265,970.03 |
| 9 | $5,632.23 | $17,122.22 | $260,337.81 |
| 10 | $6,009.43 | $16,745.02 | $254,328.38 |
| 11 | $6,411.89 | $16,342.56 | $247,916.49 |
| 12 | $6,841.31 | $15,913.14 | $241,075.18 |
| 13 | $7,299.48 | $15,454.97 | $233,775.70 |
| 14 | $7,788.34 | $14,966.11 | $225,987.36 |
| 15 | $8,309.94 | $14,444.51 | $217,677.42 |
| 16 | $8,866.47 | $13,887.98 | $208,810.95 |
| 17 | $9,460.28 | $13,294.17 | $199,350.68 |
| 18 | $10,093.85 | $12,660.60 | $189,256.83 |
| 19 | $10,769.85 | $11,984.60 | $178,486.98 |
| 20 | $11,491.13 | $11,263.32 | $166,995.85 |
| 21 | $12,260.71 | $10,493.74 | $154,735.14 |
| 22 | $13,081.83 | $9,672.62 | $141,653.30 |
| 23 | $13,957.95 | $8,796.50 | $127,695.36 |
| 24 | $14,892.74 | $7,861.71 | $112,802.62 |
| 25 | $15,890.13 | $6,864.32 | $96,912.49 |
| 26 | $16,954.32 | $5,800.13 | $79,958.16 |
| 27 | $18,089.79 | $4,664.66 | $61,868.38 |
| 28 | $19,301.29 | $3,453.16 | $42,567.08 |
| 29 | $20,593.94 | $2,160.51 | $21,973.15 |
| 30 | $21,973.15 | $781.30 | $0.00 |
The Loan Payment Formula Explained
Your monthly payment comes from the amortization formula — the same math every bank uses for fixed-rate loans:
- P — the loan amount (principal)
- r — the monthly interest rate (annual rate ÷ 12)
- n — the total number of monthly payments
- M — your monthly payment
Each payment is split into two parts: interest (what the lender charges for that month) and principal (what actually shrinks your balance). Early on, most of your payment is interest — the split flips over time. That's why extra payments early in the loan save so much: every extra dollar goes straight against principal, skipping all the future interest it would have generated.
Worked Example: $300,000 at 6.5% for 30 Years
The setup
$300,000 borrowed at 6.5% annual interest, paid back over 30 years (360 monthly payments).
Step 1 — Monthly rate and payments
r = 6.5% ÷ 12 = 0.5417% per month. n = 30 × 12 = 360 payments.
Step 2 — Apply the formula
M = 300,000 × 0.0054167 × (1.0054167)360 ÷ ((1.0054167)360 − 1) = $1,896.20/month.
Step 3 — Total cost
$1,896.20 × 360 = $682,633.21 total paid. Subtract the $300,000 borrowed: $382,633.21 in interest — more than the loan itself. That's the true price of borrowing for three decades.
Now try 15 years in the calculator above: the payment rises to about $2,612.96, but total interest drops to roughly $170,333 — you save over $212,000 by paying it off twice as fast.
15-Year vs 30-Year: The Real Trade-off
| $300,000 at 6.5% | Monthly | Total interest | Total paid |
|---|---|---|---|
| 30-year term | $1,896.20 | $382,633.21 | $682,633.21 |
| 15-year term | $2,612.96 | $170,332.61 | $470,332.61 |
The 15-year loan costs $717 more per month but saves $212,301 in interest. If you can comfortably afford the higher payment, the shorter term is almost always the better deal. If the higher payment would strain your budget, the 30-year term buys breathing room — and you can still make extra principal payments in good months to chip away at the interest.
Common Loan Mistakes
- Looking only at the monthly payment. A longer term always looks cheaper per month — check the total interest row above before celebrating.
- Ignoring the rate's leverage. On a 30-year loan, each 0.25% of rate costs roughly $45/month per $300,000 borrowed — over $16,000 across the loan. Shopping two lenders can pay for a vacation.
- Forgetting the extras. This calculator shows principal + interest only. Real mortgage payments also include property tax, homeowner's insurance, and possibly PMI — often 25–40% on top.
- Paying the minimum forever. One extra payment per year on a 30-year loan cuts roughly 4 years off the term. The amortization table above shows exactly where your money goes each year.
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Frequently Asked Questions
How is a monthly loan payment calculated?
With the amortization formula M = P × r(1+r)^n ÷ ((1+r)^n − 1), where P is the loan amount, r is the monthly interest rate, and n is the number of payments. Every lender uses this same math for fixed-rate loans.
Why is most of my early payment interest?
Interest is charged on the remaining balance each month. Early on the balance is large, so interest eats most of the payment. As the balance shrinks, more of each payment goes to principal — which is why extra payments early save the most.
Is a 15-year or 30-year loan better?
A 15-year loan at the same rate costs much less in total interest but demands a higher monthly payment. On $300,000 at 6.5%, the 15-year saves over $212,000 in interest versus the 30-year. Choose the shortest term whose payment fits your budget comfortably.
Does this include taxes and insurance?
No — this calculator shows principal and interest only. A real mortgage payment (PITI) also includes property tax, homeowner\u{2019}s insurance, and possibly PMI, which often add 25–40% on top.
What happens if I make extra payments?
Extra payments go straight against principal, skipping all the future interest that principal would have generated. One extra monthly payment per year on a 30-year loan typically cuts about 4 years off the term.
What is an amortization schedule?
A table showing, for each period, how much of your payment went to interest versus principal and what balance remains. The year-by-year table above is a compact version — early years are interest-heavy, later years are principal-heavy.