Loan Payoff Calculator
Adding even a small amount to your monthly payment goes straight at the principal, so it shortens the loan and cuts the interest you pay. Enter your balance, APR and current payment to see how much an extra monthly amount saves you.
Loan Payoff Calculator
How this calculator works
Every monthly payment is split into two parts: interest on the outstanding balance and principal that reduces that balance. The interest is calculated first, and whatever is left over goes to principal. Because interest is charged on the balance, any extra payment lowers the balance immediately and therefore lowers every future interest charge.
This tool simulates the loan month by month. It applies the monthly rate to the balance, subtracts the full payment, and repeats until the balance reaches zero. It runs the simulation twice — once with your current payment and once with your payment plus the extra amount — and reports the difference in payoff time and total interest.
The simulation stops safely if the payment does not cover the monthly interest: in that case the balance never falls and the tool tells you so rather than returning a meaningless number. The result assumes the rate stays fixed and you make every payment on time.
Frequently asked questions
Why does a small extra payment save so much interest?
Interest is charged on the balance, so an extra payment reduces the balance immediately. Every later month then accrues less interest, and that saving compounds over the remaining life of the loan.
Should I pay extra every month or in one lump sum?
Both reduce the balance. A lump sum saves interest from the day it is applied, while a steady extra amount is easier to sustain. What matters most is that the extra goes to principal, not to next month's payment.
What if my payment does not cover the interest?
Then the balance grows and the loan never pays off on its own. The calculator detects this and asks you to increase the payment. This is common with very small minimum payments on high-rate debt.
Does this account for a prepayment penalty?
No. If your contract charges a penalty for paying early, subtract that cost from the interest saved. Many personal loans have no penalty, but it is worth checking.
Will the payoff month change if my rate is variable?
Yes. This calculator assumes a fixed rate. If your rate can change, the payoff date will move as the rate moves, so re-run the numbers whenever the rate resets.
Check your rate with a lending partner in about two minutes. Checking does not affect your credit score.
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