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Personal Loan Calculator

Price an unsecured loan honestly: the monthly payment, the interest, and the effective APR once the origination fee is deducted from what you actually receive.

By Avinash Verma · editorial standards Last reviewed: Formula v1.0 · How we calculate

Inputs

How to use this calculator

From the offer in front of you, enter the loan amount, the quoted interest rate, the repayment term, and (crucially) the origination fee percentage if there is one. Most online lenders charge 1–10%; banks and credit unions often charge nothing.

  • Loan amount: the face value you are borrowing and will repay. If you need a specific sum in hand, note that a fee means you must borrow more than that sum.
  • Interest rate: the nominal annual rate on the offer. Unsecured quotes vary enormously with credit score, so use the rate you were offered, not an advertised "from" rate.
  • Term: 24 to 60 months is typical; up to 84 exists for larger loans.
  • Origination fee: the percentage the lender keeps out of the disbursal. Leave it at zero for no-fee lenders.

The results show how much lands in your bank account, along with the effective APR, which is the number to compare across offers.

Unsecured money costs more, and fees hide how much

A personal loan is unsecured: there is no house or car for the lender to repossess if you stop paying. The lender's only protection is your creditworthiness, so rates sit well above secured lending. Expect high single digits for excellent credit, and 20–35% at the subprime end, against the 6–8% a mortgage might cost. Your credit score is the dominant input: the same borrower profile can be quoted rates ten points apart by different lenders, which is why pre-qualifying with several (a soft credit pull, no score damage) routinely saves more than any other step in the process.

The second cost lever is the origination fee, and its mechanics deserve attention. The fee is not billed to you; it is deducted from the disbursal. Take this calculator's default: a $15,000 loan at 11.5% for 48 months with a 2% fee. The lender wires you $14,700, keeps $300, and calculates your $391.34 payment on the full $15,000. You are paying interest for four years on $300 you never saw.

That is exactly what APR measures. Solving for the rate at which 48 payments of $391.34 are worth the $14,700 you received gives an effective APR of 12.59% — more than a point above the quoted 11.5%. Push the fee to 5% and the APR reaches 14.27% with the same headline rate. The gap also widens on shorter terms, because the fee is spread over fewer payments: the same 2% fee on a 24-month version of this loan works out to a 13.54% APR. When two offers differ in both rate and fee, only the APR ranks them correctly.

Common uses shape the sensible term. For debt consolidation (replacing 20%+ credit-card balances with one fixed payment), a shorter term locks in the saving. For a large one-off purchase, match the term to the life of what you are buying rather than stretching for the smallest payment.

Formula and methodology

The payment uses the standard amortization formula on the full loan amount:

M = P × r × (1 + r)n ÷ [(1 + r)n − 1]  with net disbursal D = P − fee
  • M monthly payment
  • P loan face value; fee = P × fee%
  • r monthly rate = annual rate ÷ 12; n months
  • D the net amount that reaches your account

The effective APR is then the rate a that makes the present value of the n payments of M equal to D rather than P. There is no closed form for a, so the calculator solves it numerically (bisection on the annuity present-value function until it converges to well under a basis point). With no fee, D = P and the APR collapses to the nominal rate.

Worked example

Example: $15,000 at 11.5% for 48 months with a 2% fee

Monthly rate r = 0.115 ÷ 12 = 0.0095833; (1 + r)48 = 1.58061.

M = 15,000 × 0.0095833 × 1.58061 ÷ 0.58061 = $391.34 per month, and total interest over 48 payments is $3,784.09.

The 2% fee is $300, so the disbursal is $14,700. Finding the rate at which 48 payments of $391.34 are worth exactly $14,700 gives an effective APR of 12.59%. The fee added 1.09 points to the true cost without touching the quoted rate.

A competing no-fee offer at 12.25% would be the cheaper loan, despite its higher sticker rate.

What changes the result

  • Credit score. The single biggest driver of your quote. Moving from a "fair" to a "good" tier can cut an unsecured rate by 5–10 points, so it pays to check your report for errors before applying.
  • Origination fee. On the default loan, each percentage point of fee adds roughly half a point of APR. Fees hurt more on short terms, where they amortize over fewer payments.
  • Term. Longer terms shrink the payment but multiply the months of interest; 48 → 60 months on this loan adds about $1,000 of interest.
  • Secured alternatives. If you hold home equity or can post collateral, secured products usually undercut personal-loan rates, at the cost of putting the asset at risk.

Assumptions and limitations

  • Assumes a fixed rate and equal monthly payments; that holds for nearly all personal loans, unlike credit lines.
  • The effective APR here covers the origination fee only; late fees, insurance add-ons and prepaid interest are excluded.
  • Some lenders add the fee on top of the loan instead of deducting it from the disbursal. Check which structure your offer uses, as the APR math differs slightly.
  • Quotes expire and rates move with your credit file; the numbers here reflect the inputs, not a live offer.

Frequently asked questions

Why did I receive less money than the loan amount?

Your lender deducted the origination fee from the disbursal. On a $15,000 loan with a 2% fee, $300 is withheld and $14,700 arrives in your account — but the debt, and the interest, run on the full $15,000. If you need an exact amount in hand, gross it up: divide the amount you need by (1 − fee%). To net $15,000 with a 2% fee you would borrow about $15,306.

Which number should I compare between offers — rate or APR?

APR, always. The nominal rate ignores fees, so a 11.5% loan with a 2% fee (12.59% APR) is more expensive than a 12.25% loan with no fee. APR folds the fee into a single comparable yearly cost. The only caveat: APR comparisons assume you hold the loan to term. If you plan to repay very early, a fee-heavy loan gets even worse, because the fee is sunk on day one.

Is a personal loan a good way to consolidate credit-card debt?

Often, yes: swapping 20%+ revolving APRs for a fixed 11–15% installment loan cuts the interest and imposes a fixed end date. Two conditions make it work: the effective APR (after any fee) must be clearly below your cards' rates, and the freed-up cards must not be run back up. Check the plan with the debt payoff calculator before and after to confirm the saving is real.

Can I pay a personal loan off early?

Usually. Most personal lenders in the US charge no prepayment penalty, though a minority do, so read the agreement. Note that early payoff does not refund the origination fee: it was collected upfront. That is one reason short-term borrowers should prefer no-fee offers even at slightly higher rates.

How does my credit score change the numbers here?

It sets the rate you should type in. Advertised ranges are wide — a lender showing "8.99–29.99%" will price you within that band based on score, income and existing debt. Pre-qualify to get your personal rate (a soft inquiry that doesn't affect your score), then enter that figure. A ten-point rate difference on this calculator's default loan changes total interest by thousands of dollars.