Personal Loan Calculator

Personal loan total cost uses standard loan amortization to calculate the fixed monthly payment, total amount repaid over the loan term, and the total interest paid, which is the true cost of borrowing.

Monthly payment formula: M = P × [r(1+r)^n] ÷ [(1+r)^n − 1]

Where:

• M = monthly payment
• P = loan principal (the amount borrowed)
• r = monthly interest rate = APR ÷ 12
• n = loan term in months

Total cost of loan: Total Paid = M × n

Total interest paid: Total Interest = Total Paid − P

Effective APR (including origination fees): True APR = Solve for r where: P − Origination Fee = Σ [M ÷ (1+r)^t] for t = 1 to n

Many lenders charge a 1–8% origination fee deducted from disbursement, which increases the true annual cost of the loan significantly.

What each variable means:

• APR (Annual Percentage Rate) is the nominal rate used to calculate interest. The true rate including fees is often 1–2 points higher than the advertised one.
• Loan term for personal loans runs from 1 to 7 years. A shorter term means a higher payment but far less interest. A longer term means a lower payment and much more interest.
• Origination fee is a one-time charge deducted from what the lender actually hands you, or added to the balance at closing. A $500 fee on a $10,000 loan is an extra 5% charged upfront, and you pay interest on the full $10,000 either way.

Reference: monthly payment per $10,000 borrowed (verified against this calculator)

• 12 months at 10%: $879.16/month | Interest: $549.91
• 24 months at 10%: $461.45/month | Interest: $1,074.78
• 36 months at 10%: $322.67/month | Interest: $1,616.19
• 60 months at 15%: $237.90/month | Interest: $4,273.96
• 84 months at 20%: $222.06/month | Interest: $8,653.21

That last row is the one worth staring at. Stretching a $10,000 loan to seven years cuts the payment by less than half compared with three years, and multiplies the interest more than fivefold.

Worked example: Personal loan: $15,000 at 12% APR for 4 years. Origination fee: 3%, so $450.

r = 12% ÷ 12 = 1% = 0.01 M = 15,000 × [0.01 × (1.01)^48] ÷ [(1.01)^48 − 1] = 15,000 × [0.01 × 1.612226] ÷ [0.612226] = 15,000 × 0.0263340 = $395.01/month

Total paid = $395.01 × 48 = $18,960.36 Total interest = $18,960.36 − $15,000 = $3,960.36 Net disbursement after the fee = $15,000 − $450 = $14,550, but you pay interest on the full $15,000.

That last point is the whole reason origination fees matter. You borrowed $15,000 on paper, received $14,550 in your account, and repay as though you had all of it. Counting the fee, the real cost of the money is $4,410.36 and the effective rate lands at 13.64%, not the 12% on the paperwork. Enter the fee below and the calculator works this out for you.