1. What is P2P Personal Loan?

A peer-to-peer (P2P) personal loan is money borrowed from individual investors through online platforms rather than traditional financial institutions. These loans typically have fixed interest rates and repayment terms.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( P \) — Principal loan amount (USD)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Number of monthly payments
• \( PMT \) — Monthly payment amount (USD)

Explanation: The formula calculates the fixed monthly payment required to fully repay a loan over its term, including interest.

3. Importance of Loan Calculation

Details: Understanding your monthly payment helps budget effectively and compare different loan offers. It also shows the true cost of borrowing through total interest calculations.

4. Using the Calculator

Tips: Enter the loan amount in USD, annual interest rate (APR), and loan term in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How do P2P loans differ from bank loans?
A: P2P loans often have more flexible terms and may offer competitive rates, especially for borrowers with good credit.

Q2: What factors affect my P2P loan rate?
A: Credit score, loan amount, term length, and platform policies all influence your offered rate.

Q3: Are there fees not included in this calculation?
A: Some P2P platforms charge origination fees (1-6% of loan amount) which would increase your effective borrowing cost.

Q4: Can I pay off a P2P loan early?
A: Most allow early repayment, but check for prepayment penalties which would affect total interest calculations.

Q5: How accurate is this calculator?
A: It provides standard amortization results; actual payments may vary slightly due to rounding or specific platform policies.