Calculate your monthly payments, total interest, and see a full amortization schedule.
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A loan is a sum of money borrowed from a lender that is repaid over time with interest. Loans are used for major purchases like homes, cars, and education. Understanding how loans work — specifically how interest accumulates — can help you make smarter financial decisions and save money over the long term.
Monthly loan payments are calculated using the amortization formula, which ensures that each payment covers both the interest for that month and a portion of the principal. Early payments are mostly interest, while later payments are mostly principal. This is why paying extra early in a loan term can significantly reduce the total interest paid.
An amortization schedule is a table showing every payment over the life of a loan — broken down into how much goes toward principal and how much goes toward interest each month.
Paying more than the minimum reduces your principal faster, which means you pay less interest overall and can pay off the loan sooner.
A fixed rate stays the same throughout the loan term, making payments predictable. A variable rate can change based on market conditions, which means payments can go up or down.