How the loan calculator works
Enter the amount you want to borrow, the annual interest rate, and the term in years. The calculator converts the annual rate into a monthly rate and the term into a number of monthly payments, then solves for the fixed payment that pays the loan off exactly by the end of the term.
Why total interest matters
The monthly payment is only part of the story. Comparing the total interest across different rates and terms shows the true cost of a loan, and often reveals that a slightly higher payment on a shorter term saves a large amount overall.