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Loan Calculator

Calculate your fixed monthly loan payment and view the complete amortization table.

Loan & Mortgage Repayment Calculator

Calculate monthly installments, cumulative interest, and full amortization schedule.

$50,000
$
6.5%
5 Years
Monthly Payment $978.31 per month
Principal: 85% Interest: 15%
Total Principal: $50,000
Total Interest Payable: $8,698.60
Total Payment: $58,698.60

Amortization Schedule

Month-by-month repayment breakdown showing balance reducing to zero.

Financial Computation: Based on standardized Equated Monthly Installment (EMI) amortization formulas.
Reserve Bank of India (RBI) ↗

How Fixed-Rate Loan Amortization Works

Whether you are financing a home mortgage, purchasing a vehicle, or consolidating personal debt, most standard commercial loans use an amortizing fixed installment schedule. With an amortizing loan, your total monthly payment remains constant throughout the entire term, while the internal allocation between interest charges and principal reduction changes each month.

The Loan Repayment Formula (Standard Annuity Formula)

The monthly payment is calculated using the following mathematical formula:

Monthly Payment (M) = P × [ r(1 + r)ⁿ ] / [ (1 + r)ⁿ - 1 ]
  • P = Principal loan amount borrowed
  • r = Periodic monthly interest rate (Annual Rate ÷ 12 ÷ 100)
  • n = Total number of monthly repayment periods (Years × 12)

Why the Balance Decreases Faster in Later Years

During the early months of a loan, your outstanding principal balance is at its highest, meaning monthly interest charges consume the largest portion of your installment. As you gradually pay down the principal, subsequent interest calculations decrease, allowing a progressively higher percentage of each payment to clear the principal debt until the balance reaches exactly zero at the end of the term.

Benefits of Shorter Loan Terms

Choosing a 15-year term over a 30-year term typically increases your monthly installment, but cuts total cumulative interest by more than 50% and clears your debt twice as quickly.

Impact of Extra Principal Payments

Making one additional payment per year or adding a modest extra principal payment each month directly lowers your remaining balance and permanently eliminates all future interest on that portion.

Frequently Asked Questions

How is the monthly payment calculated?
Using the standard amortization formula: Monthly Payment = P × r × (1+r)^n / ((1+r)^n − 1), where P is principal, r is monthly interest rate, and n is total months.
What is an amortization schedule?
An amortization table details each payment breakdown into principal repayment and interest expense, tracking remaining loan balance until it reaches zero.
Can I use this for mortgages, car loans, and personal loans?
Yes. The fixed-rate reducing balance formula applies identically across all standard consumer and commercial fixed-rate loans.
How does interest rate affect the overall loan cost?
Even a minor increase in annual interest rate significantly increases total interest paid over long tenures, such as 15- to 30-year mortgages.
Does this calculator include lender origination or closing fees?
This calculator computes pure principal and interest amortization. Consult your lender regarding origination, documentation, or escrow fees.
Can extra payments reduce total loan interest?
Yes. In real-world loans, making additional principal prepayments shortens loan tenure and reduces total cumulative interest expense.
Does this loan calculator store my financial figures?
No. All calculations run strictly client-side inside your browser with zero server transmission.

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