See the monthly payment and total interest on a personal loan, and the real yearly cost once an origination or processing fee is included.
How to use the personal loan calculator
- Enter the amount you want, the interest rate from the offer and the term.
- If the lender charges an origination or processing fee, enter it as a % or an amount and choose whether it's taken from the loan or added to it.
- Compare the APR with fees against other offers: it's the fairer comparison when fees differ.
- Add extra payments to see how much sooner you could be done.
How a fee changes the cost
Without fees, $10,000 at 12% over 36 months costs $332.14 a month (M = P × i ÷ (1 − (1 + i)−n), with i = 1% a month), and $1,957.15 in interest. Now add a 5% fee taken from the loan: you receive $9,500, but still repay $332.14 a month for 36 months. Spread over the loan, the $500 fee works like extra interest, and the rate that matches $9,500 today with those payments is 15.61% a year. That's the APR.
Before you sign
- Compare offers by APR and total repaid, not the monthly payment alone.
- Check for prepayment and late-payment charges; they aren't in the APR.
- Borrow only what you need: the fee is usually a % of the whole loan.
In India, lenders often quote the monthly payment as an EMI: the EMI calculator shows it in rupees. For any other loan, use the loan calculator.
Frequently asked questions
What's the difference between the interest rate and the APR?
The interest rate is what you're charged on the balance. The APR (annual percentage rate) also counts upfront fees, so it shows the real yearly cost. A $10,000 loan at 12% for 3 years with a 5% ($500) fee taken from the loan has an APR of 15.61%: you get $9,500 but repay $332.14 a month, the same as a fee-free $10,000 loan.
Is the fee taken from the loan or added to it?
Lenders do it either way, so check your offer. Taken from the loan, you receive less cash and the payment stays at $332.14. Added to the loan, you get the full $10,000 but borrow $10,500, so the payment is $348.75 and you pay interest on the fee too. The APR is 15.61% with the fee taken and 15.43% with it added.
Should I choose a 3-year or a 5-year personal loan?
The longer term has a lower payment but costs more. $10,000 at 12% is $332.14 a month over 3 years ($1,957 interest) or $222.44 over 5 years ($3,347 interest).
Does paying a personal loan off early save money?
Usually, because interest is charged on the balance. An extra $50 a month on the 3-year example pays it off 5 months early and saves $305. Some lenders charge a prepayment fee, so read your agreement first.
How is the APR worked out?
It's the yearly rate at which your payments are worth exactly the money you actually received, today. The calculator finds it by trial (the actuarial method in US Regulation Z), then multiplies the monthly rate by 12. Lenders' figures can differ slightly if they charge other fees or use a different first-payment date.