Loan Repayment Schedule Calculator and Formula

Create a loan repayment schedule by entering the loan amount, annual APR, and term in years. This calculator estimates the fixed monthly payment and total interest, which you can use to build a month-by-month schedule showing how each payment is divided between interest and principal.

Formula

The calculator uses the fixed-payment amortization formula. It calculates a level monthly payment that repays principal and interest over the selected number of months, assuming a fixed rate and regular payments.

Monthly payment = round(P × r ÷ [1 − (1 + r)⁻ⁿ], 2)

Total interest = monthly payment × n − P

• P is the original loan principal, in dollars.
• APR is the annual percentage rate entered as a percent per year.
• r is the monthly rate, calculated as APR ÷ 1,200.
• n is the number of monthly payments, calculated as years × 12.
• round(…, 2) rounds each monthly payment to the nearest cent; total interest uses that rounded payment.

A repayment schedule applies the same monthly rate to the unpaid balance. For each period, interest is the opening balance multiplied by r; principal repaid is the payment minus that interest. The closing balance is the opening balance minus principal repaid.

Worked Example

Using the calculator’s defaults—$20,000 principal, 8% APR, and a five-year term:

1. Convert the annual rate to a monthly decimal: r = 8 ÷ 1,200 = 0.0066667.
2. Find the number of payments: n = 5 × 12 = 60.
3. Substitute into the payment formula: $20,000 × 0.0066667 ÷ [1 − (1.0066667)⁻⁶⁰] = $405.53 after rounding.
4. Calculate total interest using the rounded payment: ($405.53 × 60) − $20,000 = $4,331.80.

To illustrate the first schedule entries, the first month’s interest is $20,000 × 0.0066667, or about $133.33. Subtracting that from the $405.53 payment leaves about $272.20 for principal, so the estimated closing balance is $19,727.80. In month two, interest is about $131.52 on that lower balance; approximately $274.01 of the payment then reduces principal. Small differences can appear if intermediate values are rounded differently.

Assumptions

• The interest rate stays fixed for the full term.
• Payments are monthly, equal, and made at the end of each period.
• Interest is calculated monthly at APR divided by 12.
• The estimate excludes lender fees, taxes, insurance, PMI, and escrow because they are not inputs.

How to Read a Repayment Schedule

A full schedule normally has one row per payment and columns for the payment number or date, opening balance, payment, interest, principal, and closing balance. At the beginning, a larger share of each level payment generally goes toward interest because the balance is higher. As principal falls, the interest portion declines and more of the same payment reduces principal.

For the example, a simplified first row is: opening balance $20,000.00; payment $405.53; interest about $133.33; principal about $272.20; closing balance about $19,727.80. A complete schedule repeats the calculation for all 60 months. A final row may need a small adjustment when a lender’s actual daily-interest method or payment rounding differs from this monthly estimate.

The calculator gives the payment and total interest, not a downloadable list of all monthly rows. To make a schedule, repeat the balance calculation for each month using the lender’s payment dates and rounding conventions. Do not treat the displayed total interest as a separate bill: it is the estimated sum of interest included in scheduled payments.

When the Estimate Is Useful

This calculation can help explain how the loan’s amount, APR, and term relate to a level payment. It also gives a baseline for comparing a proposed repayment schedule with the figures in a lender’s disclosure. Enter the actual principal, rate, and term supplied for the loan; the example defaults are only illustrative, not a statement about available rates or loan terms.

The inputs need to describe the same repayment arrangement. If the lender quotes a monthly rate rather than an annual APR, do not enter it as though it were an annual percentage. For a variable-rate loan, this fixed-rate projection cannot show future payment changes. If payments are weekly, biweekly, irregular, or interest-only for part of the term, the standard monthly formula does not model those features.

Common Problems and Limits

• APR is not the monthly rate. Divide the annual percentage by 1,200 to get the monthly decimal used in this formula. For example, 8% becomes 0.0066667 per month, not 0.08.
• Rounding changes totals. This calculator rounds the monthly payment to cents before multiplying by the number of payments. A lender may calculate interest daily, keep more internal precision, or adjust the final payment.
• Fees and add-ons are outside the model. If a charge is financed into the principal, include it only if it is part of the amount borrowed. Other charges are not included in the payment or interest estimate.
• Extra payments change the schedule. Additional principal payments can shorten repayment and reduce interest, but this calculator assumes only the regular level payment. How an extra amount is applied depends on the loan’s terms and servicing.
• Zero APR is not an allowed input here. The payment expression divides by the rate. A zero-interest loan has a different, simpler calculation: principal divided by number of payments.

The formula assumes every scheduled payment is made in full and on time. It does not calculate late charges, skipped payments, changing rates, a balloon balance, or a payoff quote for a particular date. Use the lender’s current balance and payoff information for account-specific figures.

Frequently Asked Questions

What is a loan repayment schedule?
A repayment schedule is a timeline of payments that shows, period by period, how much goes to interest and principal and what balance remains.

How do I calculate monthly loan payments?
Convert APR to a monthly decimal by dividing it by 1,200, convert the term to months, and use the fixed-payment formula shown above. Round the payment to cents.

Why does the interest portion decrease over time?
With a fixed rate, interest for a period is calculated on the remaining balance. As principal is repaid and that balance falls, the interest charge generally falls too.

Does this calculator include extra payments?
No. It assumes the regular fixed payment only. Extra payments can alter the payoff date and interest, and their treatment depends on the loan’s terms.

Why might my lender’s schedule differ?
Lenders may use daily interest, different payment dates, other rounding rules, fees, or a final-payment adjustment. Compare the estimate with the lender’s disclosure and account-specific schedule.

This result is an estimate, and the lender’s disclosure gives the exact figures.

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in p | Loan amount | $ | 20000 | 1 | 100000000
in apr | Interest rate (APR) | % | 8 | 0.01 | 100
in yrs | Loan term | years | 5 | 0.0833 | 50
out pmt | Monthly payment | $ | round(p * (apr / 1200) / (1 - (1 + apr / 1200) ^ -(yrs * 12)), 2) | 2
out int | Total interest | $ | pmt * yrs * 12 - p | 2