Estimate monthly loan payments and total borrowing costs. Generate a full amortization schedule for personal, vehicle, or commercial credit facilities.
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Borrowing $25,000 at a 12.5% APR over a 5-year repayment term.
The borrower will repay $562.43 each month. Total interest equals $8,745.80, which is 35.0% of the principal borrowed.
Any additional principal repayment reduces your outstanding loan balance immediately, which drastically shortens your loan term and reduces total compound interest paid over time.
Simple interest is calculated only on the initial principal, whereas amortized loans recalculate interest on the reducing balance each month as principal is repaid.
Lengthening your loan tenure lowers your mandatory monthly installment, making it more affordable in the short term, but substantially increases the cumulative interest paid across the complete life of the loan.
A fixed-rate loan locks your interest rate and monthly payment for the entire agreement, offering payment certainty. A variable-rate loan adjusts whenever the central bank revises the prime lending benchmark rate.