Adam McCann, Financial Writer
@adam_mcan
To calculate monthly payments on a loan, use a free loan payment calculator and avoid having to do any math yourself. Just input the total amount of the loan, the number of years it will last, and the interest rate in order to see the monthly payment required. A good calculator will also show you the total amount of interest you'll pay over the life of the loan and how long it will take to repay the loan in full.
How to Calculate Monthly Payments on a Loan
- Visit WalletHub's free loan payment calculator.
- Put in your total loan amount and click "Next."
- Select the length of the loan and click "Next."
- Enter the interest rate on the loan and click "Next."
- View your monthly payment.
In addition to calculating the monthly payments on your loan, WalletHub's personal loan calculator shows you the total amount of interest and total amount of money you will pay to the lender, along with your loan payoff date. The calculator page also offers some helpful tips on how to save money by increasing your payment amount or paying more often.
Plus, you can see some attractive loan offers you might want to consider, based on the results of the calculator. This is especially helpful if you haven't opened a loan yet or you're considering refinancing.
How to Calculate Monthly Payments on a Loan by Hand
If you want to do the math to calculate monthly payments on a loan, you can use the following formula: a/{[(1+r)^n]-1}/[r(1+r)^n]=p.
In this equation "a" is the loan amount, and "r" is the interest rate (as a decimal) divided by the number of payments in a year. In addition, "n" is the total number of payments you will make, while "p" is your final result, the payment amount.
The good news is you should never have to calculate monthly payments on a loan yourself. Before you get a loan, you can use WalletHub's calculator. And once you have a loan, the amount due will be laid out in the loan agreement and listed on each bill you receive.
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The best way to pay off loans is with a balance transfer credit card or a debt management plan, depending on your credit score. People with good credit or better (a credit score of 700+) might be able to avoid interest on their last 12-21 months of loan payments with a 0% balance transfer credit card. People with good or excellent credit may also want to consider using a personal loan to consolidate their debt, especially if the debt...
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