Finance

Loan Payment Calculator

Find the monthly payment, total cost and interest on a loan.

Calculated Output

Monthly payment ($) 386.66

Total paid ($) 23,199.36

Total interest ($) 3,199.36

Formula: M = P·r ÷ (1 − (1 + r)^−n), r = monthly rate, n = months

Step-by-Step Breakdown

1. Values used:

2. Loan amount = 20,000 $

3. Annual interest rate = 6 %

4. Term = 5 years

6. Monthly payment = 386.66$

7. Total paid = 23,199.36$

8. Total interest = 3,199.36$

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The math behind it

M = P × r ÷ (1 − (1 + r)^−n), where P is the loan amount, r the monthly interest rate (annual ÷ 12 ÷ 100), and n the number of months.

$20,000 at 6% over 5 years → $386.66/month, $23,199 total, $3,199 interest.

Why does a longer term cost more?

Lower monthly payments mean you carry the balance longer, so more interest accrues overall.