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Loan Calculator
Amortized, deferred or interest-only — whichever way your loan is structured, this loan calculator returns the monthly payment, total interest and payoff date, and exports the full amortization schedule when you want the detail.
See how this works on a $25,000 loan at 7.5% — 3 real examples
Monthly payment
$0
Total interest
$0
Total of payments
$0
Payoff date
—
One payment, month by month
- Interest—
- Principal—
Loan balance over time
Amortization scheduleMonth-by-month breakdown
How your loan payment and interest are calculated
Each mode uses the periodic rate r = annual rate ÷ 12 and n = years × 12 payments:
Amortized: M = P · r(1 + r)n / ((1 + r)n − 1)
Deferred: FV = P(1 + r)n
Interest-only: pay P · r each period, repay P at the end
In amortized mode the level payment retires the loan by the final month; early payments are mostly interest and later ones mostly principal. On the default $25,000 at 7.5% over 5 years that is about $500.95 a month and roughly $5,057 of interest. Any extra monthly payment is applied straight to principal, the final payment is clamped so the balance lands exactly on zero, and interest saved is the difference between the baseline and accelerated schedules.
In deferred mode nothing is paid until maturity, so the balance compounds to P(1 + r)n — about $36,332 here — and all $11,332 of interest is due as one lump. In interest-only (bond) mode you pay P × r each period — about $156.25 a month, $9,375 over five years — and repay the full $25,000 principal as a balloon at the end. All math comes from BedrockCalc's shared loan engine; the rate is assumed fixed for the whole term and the first payment lands one month from today.
Same loan, three shapes of repayment
$25,000 at 7.5% for five years, three ways to schedule it. The rate never changes; the interest bill more than doubles.
Amortized: chipping at the balance
total interest$5,057
- Sixty level payments of $500.95 retire the loan on schedule.
- Every payment shrinks the balance, so every month there is less to charge interest on.
- Total repaid: $30,057 on the $25,000 borrowed.
The standard loan is the cheapest of the three because principal starts falling on day one.
Load this example (opens in a new tab)Interest-only: renting the money
total interest$9,375
- The monthly bill is only $156.25 — the interest, and nothing else.
- The balance never moves, so the full $25,000 comes due as a final balloon.
- Sixty interest payments add up to $9,375, $4,318 more than the amortized plan.
A light monthly payment, paid for by a balance that never gets smaller.
Load this example (opens in a new tab)Deferred: the meter runs in silence
total interest$11,332
- Nothing is due for five years — and interest quietly compounds the whole time.
- The $25,000 grows to $36,332 by maturity, all payable at once.
- Waiting costs $11,332, more than double the amortized plan's interest.
Deferral is not forgiveness — it is interest charged on interest until the bill lands.
Load this example (opens in a new tab)Illustrations only, not financial advice. Your own rate, taxes and insurance will differ — check with a qualified financial advisor before acting on any of this.
Picking a loan mode, in plain English
- Amortized is the normal loan. Equal payments cover interest first and chip away at principal — personal loans, auto loans and mortgages all work this way.
- Deferred loans cost the most. Paying nothing until maturity lets interest pile onto interest, so the lump due at the end dwarfs what you borrowed.
- Interest-only keeps payments low, then hits you with a balloon. Great for cash flow, risky at the end — you still owe the entire principal on the final day.
- Rate and term drive the total. A lower rate or shorter term cuts lifetime interest sharply; a longer term buys a smaller payment at a real cost.
- Extra payments punch above their weight. In amortized mode, even a small monthly extra pays the loan off early and the loan-payoff savings compound the sooner you start.
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Frequently asked questions
How is my monthly loan payment calculated?
For an amortized loan this calculator uses the standard payment formula M = P × r(1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the amount borrowed, r is the monthly rate (annual rate ÷ 12) and n is the number of payments. Borrowing $25,000 at 7.5% over 5 years works out to about $500.95 a month, of which roughly $5,057 is interest across the life of the loan.
What is the difference between the interest rate and the APR on a loan?
The interest rate is the price of borrowing the principal; the APR also folds in origination or other lender fees, so it is usually a little higher. This simple loan calculator works from the note interest rate — if your loan has upfront fees, our APR Calculator or Personal Loan Calculator converts the rate plus fees into a true APR you can compare across offers.
How does the loan term affect the total interest I pay?
A longer term lowers the monthly payment but stretches interest over more months, so you pay more overall. The same $25,000 at 7.5% costs about $2,996 in interest over 3 years but roughly $5,057 over 5 years — nearly double — even though the 5-year payment is far easier on the monthly budget.
What is an amortization schedule and how do I read it?
An amortization schedule lists every payment and splits it into interest and principal, showing the balance after each one. Early payments are mostly interest because interest is charged on a larger balance; as the balance falls, more of each fixed payment goes to principal. Open the schedule above to see the month-by-month (or annual) breakdown, and export it to CSV to keep a copy.
Can I pay off my loan early to save on interest?
Yes — in amortized mode, add any amount to the extra-payment field and the loan-payoff date, chart and schedule update instantly. On the default $25,000 loan at 7.5%, an extra $100 a month clears it about a year early and saves roughly $1,000 in interest. Most personal and auto loans have no prepayment penalty, but check your loan agreement first.
What are the deferred and interest-only loan modes?
Deferred mode makes no payments at all — the balance compounds and a single lump is due at maturity (a $25,000 loan at 7.5% grows to about $36,332 after 5 years). The interest-only loan mode has you pay just the interest each period — about $156.25 a month here — then repay the full $25,000 principal as a balloon at the end. Both cost far more in interest than amortizing, so use them only when the loan structure truly requires it.
Disclaimer: these calculators are educational tools, not financial advice. They model your inputs with published formulas, but they cannot know your full situation — for decisions with real stakes, talk to a qualified professional. Formulas and defaults last reviewed .