Loan Calculator
Enter an amount, a rate and a term to see what a loan actually costs — including a year-by-year breakdown of how much goes to interest.
Yearly summary
How to use the Loan Calculator
- Enter the amount you are borrowing and the annual interest rate quoted by the lender.
- Set the term and how often you will pay. Fortnightly and weekly schedules pay a loan off faster than monthly.
- Press Calculate, then download the full schedule as a CSV if you want to model it further.
The amortisation formula
Every fixed-rate instalment loan uses the same equation:
Payment = P × i ÷ (1 − (1 + i)⁻ⁿ)
where P is the amount borrowed, i is the interest rate for one period (annual rate ÷ payments per year) and n is the total number of payments. The result is the constant amount that reduces the balance to exactly zero after n payments.
The payment stays the same but its composition shifts. Early payments are mostly interest because interest is charged on a large outstanding balance; later payments are mostly principal. That is why overpaying early saves far more than overpaying late.
What this calculator does not include
The figures cover principal and interest only. Real loan agreements often add:
- Origination, arrangement or documentation fees, sometimes deducted from the amount you receive
- Compulsory insurance premiums
- Late payment and early repayment charges
- Different compounding conventions — some lenders compound daily and charge monthly
This is why the APR quoted on an agreement is usually higher than the headline interest rate: APR folds compulsory fees into a single comparable figure. Compare offers on APR, not on the rate.
Frequently asked questions
Why does the last payment differ slightly?
Rounding each payment to the cent leaves a small residue. The schedule adjusts the final payment to clear the balance exactly, which is what lenders do too.
Does paying fortnightly really cost less?
Yes, for two reasons. Interest accrues on a balance that drops more often, and 26 fortnightly payments equal 13 monthly payments a year rather than 12. Check that your lender applies extra payments to principal.
What if my rate is variable?
Model it at the current rate to get a baseline, then run it again at a rate two or three points higher to see how much headroom you have. A variable loan cannot be projected exactly.
Can I model an interest-only loan?
Not directly. For an interest-only period, the payment is simply the balance times the periodic rate, with no principal reduction — so the balance at the end equals the amount borrowed.
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