Frequently asked questions
How is the monthly payment calculated?
It uses the standard amortization formula: M = P × r(1+r)^n / ((1+r)^n − 1), where P is the principal, r is the monthly rate (annual ÷ 12), and n is the total number of monthly payments.
Does a lower rate or shorter term save more interest?
Both reduce total interest, but shortening the term has a bigger impact because you carry the debt for fewer months. A 5-year term at 6.5% costs roughly half the interest of a 10-year term at the same rate.
What if my rate is variable?
This calculator assumes a fixed rate. For variable-rate loans, re-run it with the new rate after each adjustment to estimate the updated payment and remaining interest.
Are taxes or fees included?
No. This calculates principal and interest only. Property taxes, insurance, origination fees, and other costs are separate. Add them to your budget on top of this payment.
Can I use this for a mortgage?
Yes — enter the loan amount, mortgage rate, and term. For a full amortization schedule and prepayment analysis, see the dedicated Loan Calculator.