Understanding how much interest you'll pay on a loan is crucial for financial planning.
This calculator helps you estimate the total interest cost over the life of a loan based on the principal amount,
the annual interest rate, and the loan term.
How It Works
The calculation for total loan interest is derived from the standard loan amortization formula.
First, we calculate the monthly payment using the following formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
M = Monthly Payment
P = Principal Loan Amount
i = Monthly Interest Rate (Annual Rate / 12)
n = Total Number of Payments (Loan Term in Years * 12)
Once the monthly payment (M) is determined, the total amount paid over the loan's life is calculated:
Total Paid = M * n
The total interest paid is then the difference between the total amount paid and the original principal loan amount:
Total Interest Paid = Total Paid – P
When to Use This Calculator:
Mortgage Loans: Estimate interest on home purchases.
Auto Loans: Plan for car financing costs.
Personal Loans: Understand the cost of borrowing for various needs.
Student Loans: Gauge the long-term expense of education financing.
Debt Payoff Strategy: Compare different loan scenarios.
By inputting the loan details, you can get a clear picture of the financial commitment and compare different loan offers.
Remember that this calculator provides an estimate; actual interest paid may vary slightly due to lender-specific
fees, payment schedules, or rounding practices.
function calculateInterest() {
var loanAmount = parseFloat(document.getElementById("loanAmount").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var resultDisplay = document.getElementById("result").querySelector("span");
if (isNaN(loanAmount) || isNaN(interestRate) || isNaN(loanTerm) || loanAmount <= 0 || interestRate < 0 || loanTerm 0) {
monthlyPayment = loanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
monthlyPayment = loanAmount / numberOfPayments;
}
var totalPaid = monthlyPayment * numberOfPayments;
var totalInterestPaid = totalPaid – loanAmount;
if (totalInterestPaid < 0) { // Handle potential floating point inaccuracies leading to tiny negative values
totalInterestPaid = 0;
}
resultDisplay.textContent = "$" + totalInterestPaid.toFixed(2).replace(/\B(?=(\d{3})+(?!\d))/g, ",");
}