Personal Loan Calculator
Calculate monthly payments and total cost for personal loans. See how interest rate and term affect your loan.
Loan Formulas
Understanding Personal Loans
Personal loans are versatile financial tools that can help you consolidate debt, finance major purchases, cover emergencies, or fund home improvements. Unlike credit cards, personal loans have fixed interest rates and set repayment terms, making budgeting predictable.
Our personal loan calculator helps you understand the true cost of borrowing by showing monthly payments, total interest, and a complete amortization schedule.
Fixed Payments
Same monthly payment throughout the loan term.
Fixed Rates
Interest rate locked in, unlike variable credit cards.
Set Timeline
Know exactly when your loan will be paid off.
Debt Consolidation
Combine multiple debts into one lower payment.
How Personal Loan Interest Works
Personal loans use amortization, meaning each payment covers both principal and interest. Early payments are mostly interest, while later payments pay down more principal.
Amortization Explained
On a $10,000 loan at 10% for 36 months, your first payment of $323 includes $83 in interest and $240 toward principal. By payment 36, only $3 goes to interest.
Total Interest Impact
A $10,000 loan at 10% for 3 years costs $1,616 in interest. Extending to 5 years drops the payment but increases total interest to $2,748.
APR vs Interest Rate
APR includes fees (origination, processing) annualized into the rate. A 10% loan with 3% origination fee has an APR closer to 12%. Always compare APRs.
Early Payoff
Paying extra toward principal saves interest. Check if your lender charges prepayment penalties before making extra payments.
Personal Loan Rates by Credit Score
Your credit score is the primary factor determining your interest rate. Even small rate differences significantly impact total cost over the loan term.
| Credit Score | Rating | Typical APR | Monthly on $10K/3yr |
|---|---|---|---|
| 720-850 | Excellent | 6-10% | $304-$323 |
| 690-719 | Good | 10-15% | $323-$347 |
| 630-689 | Fair | 15-20% | $347-$372 |
| 580-629 | Poor | 20-30% | $372-$424 |
| Below 580 | Bad | 30%+ | $424+ |
Personal Loan vs Other Options
Personal loans aren't always the best choice. Compare alternatives to find the lowest-cost option for your situation.
vs Credit Cards
Personal loans typically have lower rates (6-20%) than credit cards (15-25%). For large balances you'll pay over 6+ months, a personal loan usually saves money.
vs HELOC
Home equity lines often have lower rates (6-9%) but put your home at risk. Personal loans are unsecured—no collateral required.
vs 0% Credit Card
If you qualify for a 0% intro APR card and can pay off within the promo period, that beats any personal loan. But rates jump to 20%+ after.
vs Borrowing from Family
Family loans can be interest-free but may strain relationships. Personal loans keep finances separate and professional.
Getting the Best Personal Loan Rate
Your rate isn't set in stone. Taking steps before applying can significantly reduce your interest costs.
Check Your Credit First
Review your credit reports for errors. Disputing mistakes can boost your score 20-50 points. Get free reports at AnnualCreditReport.com.
Pay Down Credit Cards
Credit utilization under 30% improves your score. Paying cards down before applying can get you a better rate.
Compare Multiple Lenders
Rates vary widely between lenders. Check banks, credit unions, and online lenders. Multiple soft inquiries within 14 days count as one.
Consider a Co-Signer
A co-signer with excellent credit can significantly lower your rate. They're equally responsible for repayment if you default.
Choose Shorter Terms
Shorter loans often have lower rates. A 24-month loan might be 8% vs 10% for 60 months, saving on both rate and total interest.
Check Your Bank
Banks often offer rate discounts to existing customers, especially with direct deposit or substantial balances.
Common Personal Loan Uses
Personal loans are flexible, but some uses make more financial sense than others.
Debt Consolidation
Combining high-interest credit cards into a lower-rate personal loan can save thousands and simplify payments. This is one of the best uses.
Home Improvements
Unlike HELOCs, personal loans don't risk your home. Good for smaller projects where you want certainty on payments.
Medical Expenses
Better than medical credit cards, which often have deferred interest traps. Negotiate with providers first—many offer payment plans.
Weddings/Vacations
Think carefully before borrowing for discretionary spending. You'll still be paying after the memories fade. Consider saving instead.
Investments/Gambling
Never borrow to invest or gamble. The guaranteed loan interest cost rarely beats uncertain investment returns.
Everyday Expenses
If you need loans for regular bills, address the underlying budget issue first. Loans are temporary fixes that can worsen debt cycles.
Red Flags to Avoid
Not all personal loan offers are legitimate. Watch for these warning signs of predatory lending.
Guaranteed Approval
Legitimate lenders always check credit. 'Guaranteed approval regardless of credit' usually means extremely high rates or scams.
Upfront Fees
Never pay fees before receiving loan funds. Origination fees are normal but come out of loan proceeds, not paid separately upfront.
No Physical Address
Legitimate lenders have verifiable business addresses. Scammers often operate only via phone or email.
Pressure Tactics
'Act now or lose this rate' is a red flag. Legitimate offers don't require same-day decisions.
Frequently Asked Questions
What credit score do I need for a personal loan?
Most lenders require a minimum of 580-640, though some online lenders accept lower. Scores above 700 get the best rates. Below 580, you may need a co-signer or secured loan.
How long does personal loan approval take?
Online lenders often approve within minutes and fund within 1-3 business days. Banks and credit unions may take 3-7 days for approval and another few days for funding.
Will applying for a personal loan hurt my credit?
Prequalification uses a soft inquiry (no impact). Formal applications use hard inquiries, which may lower your score 5-10 points temporarily. Multiple inquiries within 14-45 days typically count as one.
Can I pay off a personal loan early?
Most lenders allow early payoff, and many have no prepayment penalty. Always check your loan terms. Paying early saves interest since it's calculated on remaining balance.
What's the difference between secured and unsecured personal loans?
Unsecured loans require no collateral but have higher rates. Secured loans use assets (car, savings) as collateral, offering lower rates but risking that asset if you default.
How much can I borrow with a personal loan?
Most lenders offer $1,000 to $50,000, with some going up to $100,000. Your limit depends on income, credit score, and debt-to-income ratio. Borrow only what you need and can afford to repay.
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