Advanced Loan Calculator

Estimate payments, compare loans, and understand the full cost of borrowing

Loan Details

$50,000
$1,000 $1,000,000
7.5%
0.1% 30%
5 years
1 year 30 years
$0
$0
$0 $2,000

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Loan Summary

Payment

+ taxes/insurance

Total Interest

+ in fees

Total Cost

+ down payment

Loan Breakdown

Principal Amount

Interest Rate

Loan Term

Payment Frequency

Loan Comparison

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Loan Details
Loan Amount
Interest Rate
Loan Term
Down Payment
Payment Frequency
Payment Amount
Total Interest
Total Cost

Cost Comparison

Amortization Schedule

Loan Amount

Interest Rate

Term

Payment

Interest vs. Principal Over Time

Year Principal Paid Interest Paid Total Payment Remaining Balance
Payment # Payment Date Payment Principal Interest Remaining Balance

Understanding Loan Payments and Financial Terms

How Are Loan Payments Calculated?

Loan payments are calculated using a mathematical formula that accounts for the principal amount, interest rate, and loan term. The standard formula used for fixed-rate loans is:

M = P [ i(1 + i)n ] / [ (1 + i)n - 1]

Where:
M = Monthly payment
P = Principal loan amount
i = Monthly interest rate (annual rate divided by 12)
n = Total number of payments (loan term in years × 12)

This formula ensures that you pay the same amount each month while gradually reducing your principal balance. In the early years of your loan, a larger portion of each payment goes toward interest, while in later years, more goes toward reducing the principal.

Different Payment Frequencies and Their Impact

While monthly payments are standard, alternative payment schedules can help you save money and pay off your loan faster:

  • Bi-weekly payments: Making half your monthly payment every two weeks results in 26 half-payments per year (equivalent to 13 monthly payments), reducing your loan term and total interest.
  • Weekly payments: Dividing your monthly payment by four and paying weekly can further accelerate your loan payoff, though the additional savings are modest compared to bi-weekly payments.
  • Accelerated payments: Paying more than the minimum payment directly reduces your principal, lowering the interest charged over the life of the loan.

Comparing Different Loan Types

SBA Loans

Small Business Administration (SBA) loans are government-backed loans designed for small businesses. They typically offer:

  • Lower down payments and longer repayment terms
  • Competitive interest rates (typically 5-8%)
  • More flexible qualification requirements than traditional business loans
  • Maximum loan amounts up to $5 million for SBA 7(a) loans

SBA loans are ideal for established businesses looking to expand, purchase equipment, or refinance debt.

Personal Loans

Personal loans are unsecured loans based primarily on your credit history and income. Key characteristics include:

  • Fixed interest rates typically ranging from 6% to 36%
  • Shorter terms, usually 2-7 years
  • No collateral requirements
  • Quick approval and funding process

Personal loans work well for debt consolidation, major purchases, or unexpected expenses.

Business Loans

Traditional business loans from banks or alternative lenders offer:

  • Higher loan amounts for qualified businesses
  • Interest rates varying widely based on business credit, time in business, and revenue
  • Terms ranging from 1-25 years depending on loan purpose
  • May require collateral and detailed business documentation

These loans are suited for established businesses with strong financials and clear expansion plans.

Key Financial Terms to Understand

APR (Annual Percentage Rate)
The yearly cost of a loan including interest and fees, expressed as a percentage. APR provides a more comprehensive view of loan costs than the interest rate alone.
Amortization
The process of paying off a loan through regular payments, where each payment covers both interest and a portion of the principal balance.
Principal
The original loan amount or the remaining balance that you're paying interest on.
Loan Term
The length of time you have to repay the loan in full, typically expressed in months or years.
Origination Fee
A fee charged by the lender to process a new loan application, typically 1-8% of the loan amount.
Prepayment Penalty
A fee some lenders charge if you pay off a loan before the end of the term, compensating them for lost interest income.

Making Smart Borrowing Decisions

Before taking out any loan, consider these important factors:

  1. Total cost of borrowing: Look beyond monthly payments to understand the full amount you'll pay over the life of the loan.
  2. Impact on cash flow: Ensure the payment amount fits comfortably within your monthly budget.
  3. Loan purpose and ROI: For business loans, calculate whether the potential return on investment justifies the borrowing cost.
  4. Alternative financing options: Compare different loan types and lenders to find the most favorable terms.
  5. Prepayment options: Check if you can make extra payments without penalties to save on interest.

Using our advanced loan calculator can help you visualize these factors and make more informed borrowing decisions.

Frequently Asked Questions

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// Update sliders loanAmountSlider.addEventListener('input', function() { loanAmountValue.textContent = formatCurrency(this.value); manualAmount.value = this.value; calculateLoan(); }); interestRateSlider.addEventListener('input', function() { interestRateValue.textContent = this.value + '%'; manualRate.value = this.value; calculateLoan(); }); loanTermSlider.addEventListener('input', function() { const years = this.value; loanTermValue.textContent = years + (years == 1 ? ' year' : ' years'); manualTerm.value = years; calculateLoan(); }); // Update from manual inputs manualAmount.addEventListener('change', function() { const value = Math.min(Math.max(this.value, 1000), 1000000); this.value = value; loanAmountSlider.value = value; loanAmountValue.textContent = formatCurrency(value); calculateLoan(); }); manualRate.addEventListener('change', function() { const value = Math.min(Math.max(this.value, 0.1), 30); this.value = value; interestRateSlider.value = value; interestRateValue.textContent = value + '%'; calculateLoan(); }); manualTerm.addEventListener('change', function() { const value = Math.min(Math.max(this.value, 1), 30); this.value = value; loanTermSlider.value = value; loanTermValue.textContent = value + (value == 1 ? ' year' : ' years'); calculateLoan(); }); // Calculate loan on button click calculateBtn.addEventListener('click', calculateLoan); // Calculate loan function function calculateLoan() { // Get values const principal = parseFloat(loanAmountSlider.value); const interestRate = parseFloat(interestRateSlider.value) / 100; const termYears = parseInt(loanTermSlider.value); const termMonths = termYears * 12; // Calculate monthly payment const monthlyRate = interestRate / 12; const monthlyPayment = principal * monthlyRate * Math.pow(1 + monthlyRate, termMonths) / (Math.pow(1 + monthlyRate, termMonths) - 1); // Calculate totals const totalPaid = monthlyPayment * termMonths; const totalInterest = totalPaid - principal; // Update result elements monthlyPaymentElement.textContent = formatCurrency(monthlyPayment); totalInterestElement.textContent = formatCurrency(totalInterest); totalPaidElement.textContent = formatCurrency(totalPaid); // Update chart const principalPercentValue = principal / totalPaid; const interestPercentValue = totalInterest / totalPaid; principalBar.style.height = (principalPercentValue * 100) + '%'; interestBar.style.height = (interestPercentValue * 100) + '%'; principalAmount.textContent = formatCurrency(principal); interestAmount.textContent = formatCurrency(totalInterest); principalPercent.textContent = (principalPercentValue * 100).toFixed(1) + '%'; interestPercent.textContent = (interestPercentValue * 100).toFixed(1) + '%'; // Generate amortization table generateAmortizationTable(principal, interestRate, termYears); } // Generate amortization table function generateAmortizationTable(principal, annualRate, termYears) { amortizationTable.innerHTML = ''; const monthlyRate = annualRate / 12; const totalMonths = termYears * 12; const monthlyPayment = principal * monthlyRate * Math.pow(1 + monthlyRate, totalMonths) / (Math.pow(1 + monthlyRate, totalMonths) - 1); let balance = principal; let yearlyPrincipalPaid = 0; let yearlyInterestPaid = 0; for (let year = 1; year <= termYears; year++) { yearlyPrincipalPaid = 0; yearlyInterestPaid = 0; for (let month = 1; month <= 12; month++) { if ((year - 1) * 12 + month <= totalMonths) { const interestPayment = balance * monthlyRate; const principalPayment = monthlyPayment - interestPayment; yearlyPrincipalPaid += principalPayment; yearlyInterestPaid += interestPayment; balance -= principalPayment; } } // Create table row const row = document.createElement('tr'); row.className = year % 2 === 0 ? 'bg-neutral-50' : 'bg-white'; row.innerHTML = ` ${year} ${formatCurrency(yearlyPrincipalPaid)} ${formatCurrency(yearlyInterestPaid)} ${formatCurrency(Math.max(0, balance))} `; amortizationTable.appendChild(row); } } // Initial calculation calculateLoan(); });