How to Use This Loan Calculator
Enter the loan amount, annual interest rate, and loan term. Select a loan type preset (auto, personal, student) to auto-fill typical rates, or enter custom values. The calculator shows your monthly payment, total interest paid, and exact payoff date.
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Average Loan Interest Rates in 2026
Interest rates vary by loan type and your credit score. Here are typical ranges in 2026: Auto loans (new car): 5.5%–8.5% · Auto loans (used car): 7.5%–12% · Personal loans: 9%–20% · Student loans (federal): 5.5%–7.05% · Home equity loans: 7%–9%.
How Is a Monthly Loan Payment Calculated?
The monthly payment formula is: M = P × [r(1+r)^n] / [(1+r)^n - 1], where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the number of payments. This is called a fully amortizing loan — each payment covers both interest and principal.
What is a good interest rate for a car loan?
For a new car, a rate below 6% is considered good in 2026. For a used car, below 8% is solid. Your actual rate depends heavily on your credit score — borrowers with scores above 720 typically get the best rates.
How much is a monthly payment on a $20,000 loan?
At 7.5% interest for 60 months (5 years), a $20,000 loan results in a monthly payment of approximately $400. Over the life of the loan, you'd pay about $4,000 in interest in addition to the principal.
Is it better to get a shorter or longer loan term?
A shorter term means higher monthly payments but less total interest paid. A longer term lowers your monthly payment but costs more overall. For example, a $25,000 loan at 7.5%: 3 years = $777/mo, $2,987 interest. 6 years = $432/mo, $6,104 interest.
Can I pay off a loan early?
Most personal and auto loans allow early payoff without penalty. Paying extra toward principal each month can save hundreds or thousands in interest and shorten your loan term significantly. Check your loan agreement for any prepayment penalty clauses.
What credit score do I need for a personal loan?
Most lenders require a minimum score of 580–600 to qualify for a personal loan. For the best rates (under 10%), aim for 700+. Some lenders offer loans for bad credit (below 580) but with much higher interest rates, often 25%–36%.