Personal Loan Interest: How Much Will You Pay?

Interest is the cost of borrowing money. In a standard fixed-payment personal loan, each scheduled payment is divided between interest and reduction of the balance. The interest portion is calculated from the outstanding balance and the periodic interest rate.

Why early payments can contain more interest

When the balance is larger, the interest charge calculated for that period is larger. As the balance falls, the interest portion generally falls too, while more of the scheduled payment goes toward principal.

Interest rate and term both matter

A higher interest rate increases the periodic interest rate. A longer term creates more scheduled payments. Looking only at the monthly payment can therefore hide differences in total interest.

Use the calculator

Enter the amount, interest rate, and term, then compare total interest and total paid. Try a second interest rate or term to see how sensitive the result is.