Repayment Calculator Online Free Tool
Repayment Calculator
Loan Details
Repayment Schedule
Enter a fixed loan term and calculate the required monthly payment
Enter a fixed payment amount and calculate how long it will take to pay off
Repayment Summary
Monthly Payment
$212.47
per month
Total Payments
$12,748.227
60 payments
Total Interest
$2,748.227
27.5% of principal
Principal vs Interest
Principal
78.4%
Interest
21.6%
Balance Over Time
Cumulative Interest Paid
Amortization Schedule
| Month | Payment | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | $212.47 | $129.14 | $83.33 | $9,870.86 |
| 2 | $212.47 | $130.21 | $82.26 | $9,740.65 |
| 3 | $212.47 | $131.30 | $81.17 | $9,609.35 |
| 4 | $212.47 | $132.39 | $80.08 | $9,476.96 |
| 5 | $212.47 | $133.50 | $78.97 | $9,343.46 |
| 6 | $212.47 | $134.61 | $77.86 | $9,208.85 |
| 7 | $212.47 | $135.73 | $76.74 | $9,073.12 |
| 8 | $212.47 | $136.86 | $75.61 | $8,936.26 |
| 9 | $212.47 | $138.00 | $74.47 | $8,798.26 |
| 10 | $212.47 | $139.15 | $73.32 | $8,659.11 |
| 11 | $212.47 | $140.31 | $72.16 | $8,518.80 |
| 12 | $212.47 | $141.48 | $70.99 | $8,377.32 |
Showing first 12 months of 60 month schedule
📚 Understanding Loan Repayment
What is a Repayment Calculator?
A repayment calculator helps you understand the financial implications of borrowing money. Whether you're taking out a mortgage, auto loan, student loan, or personal loan, this calculator shows you exactly how much you'll pay over time, how much goes toward interest versus principal, and how different payment strategies affect your total cost.
💡 Key Insight
The total interest you pay on a loan can sometimes equal or exceed the original principal amount, especially for long-term loans. Understanding your repayment schedule helps you make informed decisions about borrowing and can save you thousands of dollars.
How Loan Repayment Works
Most loans use amortization, meaning your monthly payment stays the same throughout the loan term, but the split between principal and interest changes over time:
- Early payments: Most of your payment goes toward interest, with only a small amount reducing the principal
- Mid-term payments: The split becomes more balanced as your principal decreases
- Late payments: Most of your payment goes toward principal since less interest accrues on the smaller balance
✅ Example: $10,000 Loan at 10% APR
Scenario: 5-year loan with monthly payments
Monthly Payment: $212.47
First Payment Split: $129.14 principal + $83.33 interest
Final Payment Split: $210.71 principal + $1.76 interest
Total Interest Paid: $2,748.23 (27.5% of loan amount)
🎯 Fixed Term vs Fixed Payment
Choosing Your Calculation Method
This calculator offers two approaches to planning your loan repayment. Each serves different purposes:
🗓️ Fixed Loan Term
Set a specific time period and let the calculator determine your required monthly payment.
Best for:
- Planning budget around a deadline
- Standard mortgage or auto loans
- Comparing loan term options
- When you need a specific payoff date
💰 Fixed Installments
Set a specific payment amount and see how long it will take to pay off the loan.
Best for:
- Working within a fixed budget
- Credit card debt payoff planning
- Testing extra payment scenarios
- When cash flow is the priority
⚠️ Important Warning
With fixed installments, your payment must be higher than the monthly interest charge. If your payment only covers (or is less than) the interest, your principal will never decrease, and you'll be trapped in debt indefinitely. This is a common trap with credit card minimum payments.
❌ Real-World Trap Example
Scenario: $5,000 credit card balance at 24% APR
Monthly Interest: $100
If you pay only $100/month: Your balance never decreases!
If you pay $150/month: Takes 58 months, costs $3,620 in interest
If you pay $250/month: Takes 26 months, costs $1,455 in interest
Paying just $100 more per month saves you $2,165 and 32 months of debt!
🏠 Common Loan Types
Mortgages (Home Loans)
Mortgages are typically the largest loans most people will take out in their lifetime. They're secured by the property itself and usually have terms of 15-30 years.
Typical Terms:
- 15, 20, or 30-year terms
- 3-7% interest rates (varies by market)
- Fixed or adjustable rates
- 20% down payment traditional
Key Considerations:
- Property taxes and insurance add to monthly cost
- Shorter terms = higher payment, less interest
- 15-year can save $100,000+ vs 30-year
- Extra payments dramatically reduce interest
✅ Example: $300,000 Mortgage at 6% APR
| Term | Monthly Payment | Total Interest | Total Paid |
|---|---|---|---|
| 30 years | $1,799 | $347,515 | $647,515 |
| 20 years | $2,149 | $215,838 | $515,838 |
| 15 years | $2,532 | $155,683 | $455,683 |
Choosing 15 years saves $191,832 in interest but increases monthly payment by $733
🚗 Auto Loans
Auto loans are secured by the vehicle and typically have shorter terms than mortgages. The vehicle depreciates over time, so it's important not to be "underwater" (owing more than the car's value).
Typical Terms:
- 3-7 year terms most common
- 4-10% interest rates (varies by credit)
- New cars get better rates than used
- 10-20% down payment recommended
⚠️ Warnings:
- Avoid 72+ month loans
- Car value drops faster than loan balance
- Gap insurance important for long terms
- Refinancing possible if rates drop
✅ Example: $30,000 Auto Loan at 7% APR
| Term | Monthly Payment | Total Interest | Car Value at Payoff* |
|---|---|---|---|
| 3 years | $927 | $3,361 | ~$18,000 |
| 5 years | $594 | $5,642 | ~$12,000 |
| 7 years | $450 | $7,900 | ~$7,000 ⚠️ |
*Estimated value assuming 15% depreciation per year. 7-year loan leaves you underwater for most of the term.
🎓 Student Loans
Student loans can be federal (government) or private, with different terms, interest rates, and repayment options. Federal loans often offer more flexibility and borrower protections.
Federal Student Loans:
- Fixed interest rates (3-7%)
- 10-25 year standard repayment
- Income-driven repayment options
- Forbearance and deferment available
- Possible loan forgiveness programs
Private Student Loans:
- Variable or fixed rates (4-14%)
- 5-20 year terms typical
- Credit-based approval
- Less flexible repayment options
- May require cosigner
✅ Example: $50,000 Student Loan at 5% APR
Standard 10-year repayment:
• Monthly Payment: $530.33
• Total Interest: $13,639.46
• Total Paid: $63,639.46
Extended 20-year repayment:
• Monthly Payment: $329.98
• Total Interest: $29,195.55
• Total Paid: $79,195.55
Extending the loan term reduces monthly payment by $200 but costs an extra $15,556 in interest!
💳 Credit Cards
Credit cards are revolving credit with no fixed repayment term. They typically have much higher interest rates than other loan types, making them expensive for carrying balances long-term.
⚠️ The Minimum Payment Trap
Credit card minimum payments are designed to keep you in debt as long as possible. They typically only cover interest plus 1-3% of the balance, meaning you barely make progress on the principal.
❌ Example: $3,000 Credit Card at 18% APR
| Payment Strategy | Time to Payoff | Total Interest |
|---|---|---|
| Minimum ($60/month, 2%) | 186 months (15.5 years) | $4,931 |
| $100/month | 38 months | $804 |
| $200/month | 17 months | $423 |
Paying only minimums costs you more in interest than the original balance and takes over 15 years!
💪 Accelerated Repayment Strategies
Why Pay Extra?
Making extra payments toward your loan principal can save you thousands in interest and free you from debt years earlier. Every extra dollar goes directly toward reducing your principal balance, which reduces future interest charges.
💡 The Power of Extra Payments
Because loans front-load interest, extra payments have a compounding effect. Reducing your principal early means less interest accrues over the entire loan term, creating exponential savings.
Strategy 1: Pay Extra Every Month
Add a consistent amount to your regular payment each month. Even an extra $50-100 can make a significant difference over time.
✅ Example: $200,000 Mortgage at 6% APR, 30 Years
| Extra Payment | Time Saved | Interest Saved |
|---|---|---|
| $0 (Standard) | - | $0 |
| $50/month | 2.9 years | $25,813 |
| $100/month | 5.4 years | $46,204 |
| $200/month | 9.2 years | $75,669 |
Strategy 2: Biweekly Payments
Instead of making 12 monthly payments per year, make half-payments every two weeks. This results in 26 half-payments (13 full payments) per year, giving you one extra payment annually.
✅ Benefits:
- Easier to budget with biweekly paychecks
- One extra payment per year automatically
- Reduces principal faster
- Can save years off loan term
⚠️ Considerations:
- Not all lenders allow biweekly setup
- Some charge fees for biweekly plans
- Can achieve same result with extra payment
- Requires consistent biweekly income
✅ Example: $250,000 Mortgage at 5.5% APR, 30 Years
Monthly Payments ($1,419.47 × 12):
• Total Interest: $260,807
• Payoff Time: 30 years
Biweekly Payments ($709.74 × 26):
• Total Interest: $218,324
• Payoff Time: 25.5 years
Biweekly payments save $42,483 and 4.5 years with minimal lifestyle change!
Strategy 3: Lump Sum Payments
Apply windfalls like tax refunds, bonuses, or inheritance directly to your loan principal. These large payments have an outsized impact on interest savings.
✅ Example: $150,000 Mortgage, Year 5
Scenario: You receive a $10,000 bonus in year 5 of your 30-year mortgage at 6% APR
If you apply it to principal:
• Saves approximately $23,000 in future interest
• Reduces loan term by about 3 years
• Return on investment: 230% over loan life
That $10,000 becomes $23,000 in savings - better than most investments!
Strategy 4: Refinancing
If interest rates have dropped or your credit has improved, refinancing can lower your rate and save money. However, consider closing costs and whether you'll stay in the loan long enough to benefit.
✅ When to Refinance:
- Rates dropped 0.5-1% or more
- Credit score improved significantly
- Want to switch from ARM to fixed rate
- Can shorten loan term affordably
- Break-even point within 2-3 years
❌ When NOT to Refinance:
- Planning to move within 2-3 years
- Near end of loan term
- Closing costs too high
- Rate improvement too small
- Extending term for lower payment only
⚠️ Important: Specify "Principal Only"
When making extra payments, always specify that the payment should go toward principal only. Otherwise, some lenders may apply it to future payments, which doesn't reduce your interest. Send a separate check or make a clear notation on your payment.
📊 Understanding Interest Rate Compounding
What is Compounding?
Compounding refers to how often interest is calculated and added to your loan balance. The more frequently interest compounds, the more you'll pay over time. Most loans use monthly compounding, but some use daily or annual compounding.
📅 Monthly Compounding
Most Common
Interest calculated once per month based on current balance. This is the standard for mortgages and most loans.
Also called "Monthly APR" or simply "APR"
☀️ Daily Compounding
Slightly Higher Cost
Interest calculated every day. Common for credit cards and some personal loans.
Results in slightly more interest than monthly compounding
📆 Annual Compounding
Least Common
Interest calculated once per year. Rare for loans, but sometimes used for bonds or savings.
Results in less interest than monthly or daily
✅ Example: $10,000 Loan at 10% Annual Rate, 5 Years
| Compounding Frequency | Monthly Payment | Total Interest | Difference |
|---|---|---|---|
| Annually | $210.61 | $2,636.46 | - |
| Monthly (APR) | $212.47 | $2,748.23 | +$111.77 |
| Daily | $212.77 | $2,766.18 | +$129.72 |
On a $10,000 loan, daily compounding costs about $130 more than annual compounding over 5 years.
💡 Important Note
When comparing loans, make sure you're comparing the same compounding frequency. A 10% APR with monthly compounding is not the same as 10% with daily compounding. Always ask your lender about the compounding frequency to accurately calculate your true cost.
⚖️ Pay Down Debt vs Build Savings?
The Classic Financial Dilemma
One of the most common questions in personal finance: Should I pay extra on debt or invest/save that money? The answer depends on interest rates, risk tolerance, and your overall financial situation.
💡 The General Rule
Compare your loan interest rate to potential investment returns. If your loan rate is higher than what you can safely earn investing, paying down debt is often the better "investment." However, this isn't the complete picture—you need to consider taxes, risk, and liquidity.
Decision Framework
🔴 Always Prioritize Paying Down:
- Credit card debt (15-25% APR): Nearly impossible to beat these returns investing
- Payday loans (400%+ APR): Pay these off immediately at any cost
- High-interest personal loans (10%+ APR): Usually better to pay down first
- Any debt causing financial stress: Mental health matters!
🟡 Situational Decisions:
- Auto loans (4-8% APR): Depends on market conditions and employer 401(k) match
- Student loans (4-7% APR): Federal loans have special benefits, private loans less so
- Moderate mortgages (4-6% APR): Tax deductibility and long-term investing may favor investing
🟢 Often Better to Invest:
- Low-rate mortgages (2-4% APR): Historical stock market returns ~10% annually
- 0% financing: No-brainer to invest instead (but don't miss the payoff deadline!)
- Tax-deductible debt below 4%: After tax benefit, real rate is very low
- Employer 401(k) match: Always get the full match first (50-100% instant return)
✅ Example: $500 Extra Per Month
Scenario 1: Pay Extra on 18% Credit Card ($5,000 balance)
• Saves ~$1,800 in interest over 2 years
• Guaranteed 18% "return" on your money
• No risk, no taxes owed on the "gain"
Scenario 2: Invest in Stock Market Instead
• Historical average: 10% annual return
• After taxes (~15% capital gains): ~8.5% net return
• Risk of losses during market downturns
• Potential for better returns, but not guaranteed
Clear winner: Pay off the 18% debt first. It's a guaranteed 18% return with zero risk!
The Balanced Approach
Financial experts often recommend a hybrid strategy:
- Build $1,000-$2,000 emergency fund (prevents new debt when emergencies happen)
- Get full employer 401(k) match (instant 50-100% return, don't leave free money)
- Pay off high-interest debt (8%+) (guaranteed high "return" with no risk)
- Build 3-6 months expenses emergency fund (prevents financial catastrophe)
- Split extra money: Pay down moderate debt + invest for retirement
- Don't rush low-rate debt (under 4%) if you have better investing opportunities
⚠️ Don't Forget About Liquidity
Money paid toward debt is locked away—you can't easily access it in an emergency. Before aggressively paying down debt, make sure you have an adequate emergency fund. Otherwise, you might need to take on new (expensive) debt when unexpected costs arise.
🎯 Tips for Successful Loan Repayment
✅ Do These Things
- •Set up automatic payments to never miss a due date
- •Pay more than the minimum whenever possible
- •Apply windfalls (bonuses, tax refunds) to principal
- •Round up payments to the nearest $50 or $100
- •Review your loan annually for refinancing opportunities
- •Keep track of amortization to stay motivated
- •Maintain good credit for better refinancing terms
- •Understand prepayment penalties before paying extra
❌ Avoid These Mistakes
- •Skipping payments damages credit and adds fees
- •Paying only minimums on high-interest debt
- •Taking out new debt while trying to pay off old debt
- •Extending loan terms just for lower payments
- •Ignoring compound frequency when comparing loans
- •Forgetting about prepayment penalties
- •Aggressively paying debt without emergency fund
- •Refinancing too often (closing costs add up)
💪 Stay Motivated
Paying off debt is a marathon, not a sprint. Here are strategies to stay motivated:
- ✓Track your progress with charts and graphs
- ✓Celebrate milestones (25%, 50%, 75% paid off)
- ✓Calculate total interest saved from extra payments
- ✓Join debt payoff communities for support
- ✓Visualize what you'll do when debt-free
- ✓Track how much interest you save each month
💡 Final Thought
The best repayment strategy is the one you'll stick to consistently. Whether you choose aggressive paydown or a balanced approach with investing, the key is making informed decisions and maintaining discipline. Use this calculator regularly to see how different strategies impact your financial future, and remember: every extra dollar toward principal is a dollar that won't cost you interest.