Loan Repayment Calculator
Calculate loan payments with different repayment schedules: even payments, even principal, or balloon payments. Compare total costs and payment structures.
Loan Specifications
Equal monthly payments with decreasing interest and increasing principal over time
Total amount to borrow
Annual interest rate
Loan term in years
Extra months beyond years
How often interest compounds
Additional payment each period
Repayment Results
Payment Type: Even Total
Compound Frequency: Monthly
Extra Payment: $0.00
Interest Rate: 7.5% annual
Payment Analysis
Yearly Payment Schedule
| Year | Total Payment | Principal Paid | Interest Paid | Remaining Balance |
|---|---|---|---|---|
| 1 | $1,424.42 | $698.09 | $726.33 | $9,301.91 |
| 2 | $1,424.42 | $752.29 | $672.13 | $8,549.62 |
| 3 | $1,424.42 | $810.69 | $613.73 | $7,738.93 |
| 4 | $1,424.42 | $873.63 | $550.79 | $6,865.30 |
| 5 | $1,424.42 | $941.45 | $482.97 | $5,923.85 |
| 6 | $1,424.42 | $1,014.54 | $409.88 | $4,909.31 |
| 7 | $1,424.42 | $1,093.30 | $331.12 | $3,816.01 |
| 8 | $1,424.42 | $1,178.17 | $246.25 | $2,637.84 |
| 9 | $1,424.42 | $1,269.64 | $154.78 | $1,368.20 |
| 10 | $1,424.42 | $1,368.20 | $56.22 | $0.00 |
Table shows yearly totals: Principal (green) goes toward loan balance, Interest (red) is the cost of borrowing. Balance decreases as principal is paid.
Payment Type Comparison
Even Total Payments
Structure: Same payment each month
Early years: Mostly interest
Later years: Mostly principal
Best for: Predictable budgeting
Even Principal Payments
Structure: Same principal each month
Early years: Higher total payments
Later years: Lower total payments
Best for: Minimizing total interest
Balloon Payment
Structure: Low payments + large final payment
During term: Lower monthly payments
At end: Large balloon payment due
Best for: Short-term cash flow management
💡 Repayment Tips
Extra Payments
Additional payments go directly to principal, reducing total interest
Payment Timing
Earlier payments in the month can reduce daily interest charges
Refinancing
Consider refinancing if rates drop significantly
Budget Planning
Ensure payments fit comfortably within your budget
Repayment Facts
Understanding Loan Repayment
What is Loan Repayment?
- •Definition: Process of paying back borrowed money with interest
- •Components: Principal (loan amount) + Interest (cost of borrowing)
- •Schedule: Usually equal monthly installments over set term
- •Amortization: Gradual reduction of debt through payments
Repayment Schedules
- •Even Total: Same payment amount each period
- •Even Principal: Same principal amount, decreasing total
- •Balloon: Lower payments with large final payment
- •Interest-Only: Pay only interest, principal due at end
Repayment Formulas
Even Total Payment Formula
P: Monthly payment amount
A: Loan amount (principal)
i: Periodic interest rate
n: Number of payments
Remaining Balance Formula
B: Remaining balance
A: Original loan amount
p: Number of payments made
n: Total number of payments
Frequently Asked Questions
Which repayment schedule saves the most money?
Even principal payments typically result in the lowest total interest cost because you pay down the principal faster in the early years, reducing the base amount on which interest is calculated.
When should I consider a balloon payment?
Balloon payments are useful when you need lower monthly payments temporarily but expect a large cash inflow (like a bonus, inheritance, or business sale) before the balloon payment is due.
How do extra payments help?
Extra payments go directly toward the principal balance, reducing the amount on which future interest is calculated. This can significantly shorten the loan term and reduce total interest paid.
What's the difference between compound frequencies?
More frequent compounding (daily vs. monthly) means interest is calculated and added to the balance more often, resulting in slightly higher total interest costs over the loan term.