Loan Repayment & Payoff Calculator
Enter your loan balance, interest rate, and term to get your monthly payment, total interest cost, and a full amortization schedule. Add an extra monthly payment to see exactly how many months earlier you will be debt-free and how much interest you will save. Switch between standard amortization and even-principal repayment modes.
How loan amortization works
With a standard amortized loan, each payment stays the same dollar amount from start to finish. What changes is the split between interest and principal. In the early months, a larger share goes to interest because the outstanding balance is high. As the balance shrinks, the interest portion of each payment falls and the principal portion rises, so the loan is paid off in exactly the agreed number of payments. The formula for the fixed monthly payment is P x r x (1+r)^n / ((1+r)^n - 1), where P is the principal, r is the monthly interest rate, and n is the total number of payments.
Even-principal vs. standard amortization
The even-principal (or "flat-principal") repayment method divides the loan balance equally across all months and then adds the interest on the remaining balance to each payment. This means your first payment is the highest and payments gradually decrease as the balance falls. You pay less total interest than with standard amortization because the balance drops faster, but the higher early payments require a stronger cash flow. Standard amortization is more common for mortgages and personal loans because the fixed payment is easier to budget.
How extra payments accelerate payoff
Any amount you pay beyond the scheduled minimum goes entirely toward reducing the principal (not future interest). Because next month's interest charge is calculated on the new, lower balance, every dollar of extra principal payment has a ripple effect: it reduces every subsequent interest charge for the rest of the loan. This is why even a modest extra payment, say $50 or $100 a month, can cut years off a long loan and save thousands in interest. The calculator shows you the exact months saved and interest avoided based on your extra payment amount.
Understanding your amortization schedule
The schedule table below the results shows your loan broken down year by year: how much you pay in total, how much reduces the principal, how much goes to interest, and what balance remains. In the early years, a surprisingly large share goes to interest. If you are considering paying off your loan early, the schedule lets you see exactly what your balance will be at any point in the future, which is the figure you would need to make a lump-sum payoff.
Typical personal loan interest rates by credit tier (2025)
| Credit score range | Credit tier | Typical APR range |
|---|---|---|
| 720 and above | Excellent | 6% - 12% |
| 690 - 719 | Good | 12% - 18% |
| 630 - 689 | Fair | 18% - 25% |
| Below 630 | Poor / Limited | 25% - 36%+ |
Average APRs vary by lender. These are general reference ranges only.
Frequently asked questions
What is an amortization schedule?
An amortization schedule is a complete table of every loan payment, showing how each one is divided between interest and principal, and what the remaining balance is after each payment. Early in the loan, most of each payment goes to interest. Over time, the interest portion shrinks and more goes toward reducing the principal. The schedule lets you see your exact balance at any point, which matters if you want to pay off the loan early or refinance.
How much can I save with extra payments?
The savings depend on your loan balance, interest rate, and how many months remain. On a $20,000 loan at 7% over 5 years, adding just $100 a month extra cuts roughly 9 months off the term and saves around $380 in interest. On larger, longer loans such as mortgages, the savings are proportionally much larger. Use the extra payment field to see your personalised figures.
What is the difference between APR and the interest rate?
The interest rate is the base cost of borrowing the principal. The annual percentage rate (APR) adds fees and other costs and is expressed as a yearly rate, making it easier to compare loans. For a simple personal loan with no origination fee, the APR and interest rate are often the same. For mortgages or loans with upfront fees, the APR is higher than the stated rate. This calculator uses the rate you enter as an annual rate and divides it by 12 for monthly compounding.
What is even-principal repayment and who is it for?
Even-principal repayment (also called "flat-principal" or "declining-balance" repayment) splits the principal equally across all months and adds the monthly interest on top. Your payment starts high and falls each month as the balance drops. It results in lower total interest than standard amortization because the balance falls faster, but it demands higher cash flow in the early months. It is common in some European markets and commercial lending, and it can be a good choice if you expect your income to grow over time or you want to pay as little interest as possible.
How do I calculate how long until my loan is paid off?
For a standard amortized loan with no extra payments, the payoff date is simply the agreed term. If you make extra payments, the payoff date moves earlier because each extra dollar reduces the remaining balance and cuts future interest charges. This calculator tracks the balance month by month and counts the exact number of payments needed to reach zero, so the "months to pay off" figure automatically reflects your extra payment amount.
Should I pay off my loan early or invest the extra money?
This is a personal finance trade-off. Paying off a loan early gives a guaranteed return equal to the loan's interest rate. Investing in a diversified stock portfolio has historically returned more over long periods, but with risk and volatility. As a rough rule of thumb, if your loan rate is above 7-8%, paying it down is often a better risk-adjusted choice. If your rate is low (under 5%) and you have an emergency fund, investing may come out ahead. Always consider your emotional relationship with debt and any tax advantages of the investment before deciding.