Loan Payment Calculator
The other side of the ledger. See the equal monthly payment, total interest and total cost of any loan — and how much of each payment is principal versus interest over time.
Your loan
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%
30 years
Loans are amortized monthly: your rate is applied as an effective monthly rate (annual ÷ 12) — the standard fixed-rate mortgage convention.
Monthly payment for $500,000 over 30 years
$2,684/mo
Principal (loan amount)$500,000
Total interest$466,279
Total you'd repay$966,279
Principal paidInterest paid
Show yearly breakdown
| Year | Remaining balance | Principal paid | Interest paid |
|---|
How this calculation works
The formula
This is the standard equal-installment (amortizing) loan. With loan amount P, monthly rate i and N months, the monthly payment is:
M = P · i · (1+i)N / ( (1+i)N − 1 )
Each month you pay interest on the remaining balance, and the rest reduces principal. Early payments are mostly interest; later payments are mostly principal.
Assumptions
- The interest rate is fixed for the whole term (equal installments, principal + interest).
- Payments are made at the end of each month.
- Loans are amortized monthly — the rate is applied as an effective monthly rate (annual ÷ 12), the standard fixed-rate mortgage convention.
- Fees, taxes, insurance and other charges are not included.
- The result is in nominal dollars — inflation is not modeled.
Educational purposes only. Not financial advice. See the full methodology and disclaimer.
Loans, explained
How is the monthly payment calculated?
It uses the standard amortization formula
M = P·i·(1+i)^N / ((1+i)^N − 1), where P is the loan amount, i the monthly rate and N the number of months. Every month you pay the same amount; interest is charged on the remaining balance and the rest pays down principal.Why is most of my early payment interest?
Each month's interest is charged on the remaining balance, which is largest at the start. As you pay down principal, the interest portion shrinks and more of your fixed payment goes to principal. The yearly breakdown shows this shift clearly.
Are fees, taxes and insurance included?
No. This is the pure principal-plus-interest payment. Real loans often add property tax, insurance, or fees — add those separately to find your true monthly cost.
Does a longer term mean a smaller payment but more interest?
Yes — and the effect can be dramatic. Stretching a $500,000 loan at 5% from 20 to 30 years lowers the monthly payment but roughly doubles total interest. Use the slider to compare terms before you commit.