Enter your loan details and see how extra payments can accelerate your payoff and save you money.
Your Payoff Summary
Original Payoff Time: months
New Payoff Time (with extra payments): months
Months Saved: months
Total Interest Paid (Original):
Total Interest Paid (with extra payments):
Total Interest Saved:
Understanding Your Personal Loan Payoff
A personal loan is a flexible financial tool, but understanding how to manage its repayment can significantly impact your financial health. This calculator helps you visualize the power of making extra payments towards your personal loan, demonstrating how small additional contributions can lead to substantial savings in both time and interest.
How it Works: The Math Behind the Calculator
This calculator uses a standard loan amortization formula to determine the payoff timeline and total interest paid. Here's a breakdown of the key calculations:
Monthly Interest Rate: This is derived from your Annual Interest Rate by dividing it by 12. For example, an 8.5% annual rate becomes approximately 0.7083% per month (8.5 / 12 / 100).
Calculating Payoff Time (Without Extra Payments): The formula to find the number of payments (n) is:
$n = -\frac{\log(1 – \frac{P \times i}{M})}{\log(1 + i)}$
Where:
Calculating Total Interest Paid (Without Extra Payments):
Total Interest = (Monthly Payment * Number of Payments) – Principal Loan Amount
Calculating Payoff Time (With Extra Payments): When you add an extra payment, the new effective monthly payment becomes Current Monthly Payment + Extra Monthly Payment. The same formula as above is used, but with this new, higher monthly payment (M').
Calculating Total Interest Paid (With Extra Payments):
Total Interest = (New Monthly Payment * New Number of Payments) – Principal Loan Amount
Savings: The calculator then compares the two scenarios to show:
Months Saved = Original Payoff Months – New Payoff Months
Total Interest Saved = Original Total Interest – New Total Interest
Why Make Extra Payments?
Even a small extra payment can have a compounding effect over time:
Reduced Interest: The sooner you pay down your principal, the less interest accrues over the life of the loan. This is the most significant benefit.
Faster Payoff: Paying extra directly reduces the loan term, freeing you from debt sooner and allowing you to redirect those funds to other financial goals.
Improved Financial Freedom: Being debt-free faster provides peace of mind and opens up opportunities for saving, investing, or tackling other financial priorities.
When to Use This Calculator:
You've just taken out a personal loan and want to plan for early repayment.
You're considering making a lump-sum payment towards your loan.
You want to see if increasing your monthly contribution is financially worthwhile.
You're trying to budget and want to know the potential impact of allocating extra funds to debt.
Use this calculator as a tool to empower your financial decisions and take control of your personal loan repayment journey.
function calculateLoanPayoff() {
var loanAmount = parseFloat(document.getElementById("loanAmount").value);
var annualInterestRate = parseFloat(document.getElementById("annualInterestRate").value);
var currentMonthlyPayment = parseFloat(document.getElementById("currentMonthlyPayment").value);
var extraMonthlyPayment = parseFloat(document.getElementById("extraMonthlyPayment").value);
var errorMessageDiv = document.getElementById("error-message");
errorMessageDiv.style.display = "none"; // Hide error message initially
// Input validation
if (isNaN(loanAmount) || loanAmount <= 0 ||
isNaN(annualInterestRate) || annualInterestRate <= 0 ||
isNaN(currentMonthlyPayment) || currentMonthlyPayment <= 0 ||
isNaN(extraMonthlyPayment) || extraMonthlyPayment < 0) {
errorMessageDiv.textContent = "Please enter valid positive numbers for all fields, and a non-negative number for extra payment.";
errorMessageDiv.style.display = "block";
document.getElementById("result").style.display = "none";
return;
}
var monthlyInterestRate = annualInterestRate / 100 / 12;
// — Calculate Original Payoff —
var originalMonths = 0;
var remainingBalanceOriginal = loanAmount;
var originalTotalInterest = 0;
// Check if current monthly payment is enough to cover interest
if (currentMonthlyPayment 0) {
var interestPayment = remainingBalanceOriginal * monthlyInterestRate;
var principalPayment = currentMonthlyPayment – interestPayment;
remainingBalanceOriginal -= principalPayment;
originalTotalInterest += interestPayment;
originalMonths++;
if (originalMonths > 10000) { // Prevent infinite loops for impossible scenarios
errorMessageDiv.textContent = "Calculation for original payoff is taking too long, please check your input values.";
errorMessageDiv.style.display = "block";
document.getElementById("result").style.display = "none";
return;
}
}
// Adjust last payment if it overpays
if (remainingBalanceOriginal < 0) {
originalTotalInterest += remainingBalanceOriginal; // Subtract the overpaid amount from interest
}
// — Calculate New Payoff —
var newMonthlyPayment = currentMonthlyPayment + extraMonthlyPayment;
var newMonths = 0;
var remainingBalanceNew = loanAmount;
var newTotalInterest = 0;
// Check if new monthly payment is enough to cover interest
if (newMonthlyPayment 0) {
var interestPayment = remainingBalanceNew * monthlyInterestRate;
var principalPayment = newMonthlyPayment – interestPayment;
remainingBalanceNew -= principalPayment;
newTotalInterest += interestPayment;
newMonths++;
if (newMonths > 10000) { // Prevent infinite loops for impossible scenarios
errorMessageDiv.textContent = "Calculation for new payoff is taking too long, please check your input values.";
errorMessageDiv.style.display = "block";
document.getElementById("result").style.display = "none";
return;
}
}
// Adjust last payment if it overpays
if (remainingBalanceNew < 0) {
newTotalInterest += remainingBalanceNew; // Subtract the overpaid amount from interest
}
// — Display Results —
var monthsSaved = originalMonths – newMonths;
var totalInterestSaved = originalTotalInterest – newTotalInterest;
var amountSaved = totalInterestSaved; // Renaming for clarity as per requirement
document.getElementById("originalPayoffMonths").textContent = originalMonths.toFixed(0);
document.getElementById("newPayoffMonths").textContent = newMonths.toFixed(0);
document.getElementById("monthsSaved").textContent = monthsSaved.toFixed(0);
document.getElementById("originalTotalInterest").textContent = "$" + originalTotalInterest.toFixed(2);
document.getElementById("newTotalInterest").textContent = "$" + newTotalInterest.toFixed(2);
document.getElementById("totalInterestSaved").textContent = "$" + totalInterestSaved.toFixed(2);
document.getElementById("amountSaved").textContent = "You could save $" + amountSaved.toFixed(2) + " in interest!";
document.getElementById("result").style.display = "block";
}