How is a loan's monthly payment calculated?

In an annuity loan the monthly payment is calculated with a formula that accounts for the loan amount, the monthly interest rate and the number of installments. The payment stays the same, but the interest portion shrinks and the principal portion grows over time.

What is an annuity loan?

An annuity, or equal-installment loan, means you pay the same amount every month for the entire term. At the start most of the payment is interest, at the end it's principal. Easy to budget for.

How do I save on loan interest?

A shorter loan term and larger repayments reduce the total interest. A lower interest margin (compare banks) and extra repayments also save money.

How much interest will I pay in total?

The total interest depends on the loan amount, the interest rate and the term. The calculator shows the exact sum. A long loan term significantly increases the total interest, even though the monthly payment is lower.

Loan Calculator

Name: Loan Repayment Calculator 2026
Author: Miikka

Calculate loan monthly payment, interest and repayment time. Annuity loan. See total interest paid. Free loan calculator.

By Miikka · CalcBrew · Updated Sep 16, 2026

Loan amount: $20,000

Annual interest rate: 6.00 %

Loan term: 5 yrs

$387/mo

Monthly payment

Monthly payment	$387
Total paid	$23,199
Total interest	$3,199
Number of payments	60

ℹ️ The calculator uses an annuity (fixed-payment) loan where the monthly payment stays the same for the whole term. The actual rate may include a margin on top of a reference rate. Bank fees come on top.

This loan repayment calculator works out the monthly payment, total interest and repayment period for an annuity loan. You see at once how much the loan costs each month and how much interest builds up over its full term.

How the calculator works and what it’s for▾

How the monthly payment is calculated

The calculator uses an annuity loan, where the monthly payment stays the same for the whole term. Early on a larger share of the payment is interest, and towards the end an ever larger share pays down the principal.

The monthly payment is set by the combined effect of the loan amount, the annual rate and the term: a higher rate and a longer term raise the total interest paid.

What you enter and what you get

Enter the loan amount in dollars, the annual interest rate as a percentage and the term in years.

You get the monthly payment, the total of all payments, the total interest accrued and the number of instalments. The total interest figure shows how much the loan costs on top of the principal alone.

Who it is for

The tool suits anyone considering a mortgage, car loan or consumer credit who wants to compare different loan amounts, rates and terms before deciding.

It also helps you gauge how a shorter term or larger repayments would reduce the total interest you pay.

Good to know

The actual rate may consist of a reference rate plus the bank's margin, and handling fees come on top, so the final cost can differ from the calculator's estimate.

Use the result to compare and plan. For a precise offer and the true annual rate, always check with the bank.

🔄 Reviewed June 2026

Frequently asked questions

Cite this calculator

APACalcBrew. (2026). Loan Repayment Calculator 2026. https://calcbrew.com/loan-repayment-calculator

MLA“Loan Repayment Calculator 2026.” CalcBrew, 2026, calcbrew.com/loan-repayment-calculator.

Link to https://calcbrew.com/loan-repayment-calculator. Results are estimates; cite the underlying formula or data source for academic work.

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