Personal Loan Calculator
Last Updated:
Calculate your exact monthly payment, total interest, and total cost for any personal loan.
Monthly Payment
$0.00
📐 Formula
Monthly Payment = P × [r(1+r)^n] / [(1+r)^n − 1] where P = principal, r = monthly rate, n = months
How to Use the Personal Loan Calculator
Enter the loan amount
Input the amount you need to borrow. Note that origination fees (1–8%) may be deducted from disbursement — you may need to borrow slightly more to receive the exact amount needed.
Set the interest rate
Enter your loan's APR — the legally required all-in rate including fees. Always compare APRs across lenders, not base rates, which can obscure fee structures.
Choose the term
Personal loans typically range 12–84 months. Compare total interest paid across terms, not just monthly payment — the total cost difference is significant.
Evaluate the purpose test
Would this loan's purpose generate value (debt consolidation savings, unavoidable expense) that justifies the total interest cost? If not, review alternatives.
When a Personal Loan Makes Financial Sense
Personal loans are most valuable in three scenarios. First, debt consolidation: replacing multiple 20–24% APR credit cards with a single 10–15% personal loan reduces total interest and simplifies repayment. On $15,000 of credit card debt, this rate difference can save $1,500–$2,500 in annual interest charges. Second, large necessary expenses: medical bills, emergency home repairs, or other unavoidable costs where savings do not yet cover the amount. Third, building credit: a small instalment loan repaid on time builds payment history and credit mix — both positive credit score factors.
Origination Fees: The Hidden Cost
A $10,000 loan with a 5% origination fee nets you $9,500 while requiring repayment of the full $10,000 plus interest — the effective rate is higher than the stated APR suggests. The APR calculation is legally required to include fees, so always compare APRs across lenders rather than base interest rates. Online lenders (SoFi, LightStream, Marcus) consistently offer lower APRs and fees than traditional banks for creditworthy borrowers. Getting pre-qualified with 3–4 lenders via a soft credit check (which does not affect your score) takes 15 minutes and can save hundreds of dollars in interest.
How to Calculate a Personal Loan Payment by Hand: Worked Example
Consider a $15,000 personal loan at 12% APR over 36 months. The monthly rate is 0.12 ÷ 12 = 0.01. Using the amortization formula M = P × [r(1+r)ⁿ] ÷ [(1+r)ⁿ − 1]:
M = $15,000 × [0.01 × 1.01³⁶] ÷ [1.01³⁶ − 1] = $498.21 per month. Over the full term you repay 36 × $498.21 = $17,935.73, so total interest is $2,935.73 — about 19.6 cents of interest for every dollar borrowed.
How does an origination fee change the real cost?
Here is the trap the APR is designed to expose. A 5% origination fee on the $15,000 loan is $750, deducted up front — you receive only $14,250 but repay interest on the full $15,000. Your effective borrowing cost is therefore meaningfully higher than the quoted interest rate. When comparing offers, a 12% loan with a 5% fee is generally worse than a 13.5% loan with no fee on a 3-year term; the calculator lets you verify by comparing total repaid against cash actually received.
When Does a Personal Loan Beat the Alternatives?
Is a personal loan cheaper than carrying a credit card balance?
Usually, and by a wide margin. Average credit card APRs run in the low-to-mid 20s, while borrowers with good credit see personal loan rates around 10–14%. Consolidating $15,000 of card debt at 24% into the 12% loan above saves roughly $1,500–$2,500 of interest over three years — and converts open-ended minimum payments into a fixed payoff date. The consolidation only works, however, if the cards stay at zero afterward; running the balances back up doubles the debt rather than refinancing it.
What loan term should you choose?
The shortest term whose payment fits comfortably in your budget. Stretching the $15,000 loan from 36 to 60 months drops the payment by about $164 but adds roughly $2,100 of interest. A useful middle path: take the longer term for the lower required payment, then pay the 36-month amount voluntarily — most personal loans have no prepayment penalty, so you get the safety margin without the interest cost. Confirm the no-penalty clause before signing.
What credit score do you need for the best rates?
Top-tier pricing generally starts around a 740+ FICO score, with the most competitive offers above 780. Below 670, quoted APRs rise steeply and origination fees become more common — at that point, comparing the loan's total cost against simply attacking the existing debt with the same monthly cash flow often favors the latter.
Frequently Asked Questions
Sources & Methodology
Calculations are based on the most current publicly available data from authoritative government and industry sources: