Personal Loan Monthly Payment Calculator

You can use personal loans for dozens of needs, including consolidating your high-interest, high-payment credit card debt.

Personal Loan

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Debt consolidation personal loans can simplify your finances by combining multiple debts into one payment, making managing it easier.

They often come with lower interest rates, which can save you money and help you pay off your debt more quickly.

3 factors determine your personal loan payment amount: loan amount, loan term (time it takes to pay it off), and interest rate.

Use this calculator to see how much money you could save and how much lower your monthly payments could be with the right debt consolidation personal loan.

Find Lenders with the Lowest Rates and Fees

Which lenders have the best rates, lowest fees, and most favorable terms? Use our curated list to find the best personal loan for your needs.

Personal Loan Payment: Your Loan Amount

Personal loan providers may offer loan amounts as low as $1,000 and as high as $100,000.

The amount you qualify for depends on their policies and your income, debts, and credit rating.

The more you borrow, the higher your monthly payment. Here are some examples of different loan amounts, with payoff time and interest rates being the same.

Payment Amount Based on Loan Amount

That’s why our personal loan payment calculator is so helpful. You can input any combination of factors and see how it affects your monthly payment depending on your loan amount.

Personal Loan Payment: Your Loan Term

Your loan term also affects your monthly payment. This is the number of years to repay the loan.

Most personal loans are installment loans with fixed interest rates.

This means you make equal monthly payments and repay the loan by the end of its term. Most personal loans allow you to prepay your loan, zeroing out your balance sooner and saving on interest charges.

The chart below shows how one-, five-, seven-, 10-, and 15-year terms impact the payment of a $10,000 loan at an 8% interest rate.

Payment Amount Based on Loan Term

Notice that even though longer loan terms result in lower monthly payments, your total interest paid is higher – sometimes much higher. Personal finance specialists generally recommend using long-term loans only for long-term purposes. For instance, a ten-year loan for college tuition or a sizable home renovation can be a sensible choice. But you probably don’t want to be still paying off your wedding loan on your tenth anniversary.

The loan term, like the loan amount, affects what lenders charge. Longer terms are riskier to lenders, and they normally charge higher rates to compensate for that extra risk. Here are typical interest rates for highly qualified applicants at different terms from the same lender:

  • 2 years: 4.44% to 13.29%
  • 5 years: 4.94% to 14.49%
  • 7 years: 5.39% to 14.99%
  • 12 years: 6.89% to 14.99%

Be sure to check rates for the term you want when using the MoneyRates calculator.

Personal Loan Payment: Your Interest Rate

The biggest influence on your personal loan payment is likely to be your interest rate. As you have seen in the charts above, lenders apply different interest rates depending on the length and amount of the loan. But the most important factor lenders use when setting your interest rate is your credit rating. Personal loan interest rates from mainstream lenders range from under 6% to over 36%.

The chart below illustrates monthly payments for a $5,000 loan over a five-year period for interest rates ranging from 5% to 25%.

How to Get the Best Interest Rate on a Personal Loan

Of course, you want the lowest interest rate for your personal loan. And there are two ways to do that: becoming a desirable applicant and shopping aggressively.

To become the most desirable applicant, you need two things: excellent credit and a low debt-to-income ratio.

Related: Personal Loan Interest Rates (How to Pay Less)

Debt-to-Income (DTI)

You calculate your debt-to-income ratio, or DTI, like this: first, add up your total monthly bills – the minimum payments on your credit cards, your student loan, auto loan, and other loan payments, and your rent or mortgage (including property taxes and homeowners insurance). Then, divide that total by your gross (before tax) monthly income.

For example, if you pay $1,000 a month in rent, have credit card payments of $150, and a $350 auto loan payment, your total monthly bills equals $1,500. (You don’t count living expenses like food or utilities.) If your gross monthly income is $6,000, your DTI is $1,500 / $6,000. That’s .25 or 25%.

If you apply for a personal loan with a $500 per month payment, the lender calculates your new DTI: $2,000 / $6,000 = 33%. That’s a good, low number. Lenders like to see DTIs under 38%, but some will lend at DTIs up to 50%.

Related: Credit Check for Personal Loans (How Does it Affect Your Credit Score?)

Credit Score

To maximize your credit score, you need several things: at least three accounts with good and extensive payment history, low credit utilization, and no derogatory events like collections, judgments, foreclosures, or missed payments. Credit utilization refers to the amount of credit you have (your credit limits) versus the amount you use. Consumers with the best credit scores don’t utilize more than 10% of their credit, and people with good scores keep it under 30%.

If you have some blemishes on your credit history, time is your friend. Keep making on-time payments (open up a few small “second chance” accounts if necessary), and let those black marks fade away.

Check your credit report for errors – about 20% of reports contain errors that could get your loan applications denied or cause you to pay higher interest rates. Contact the credit bureaus to correct the errors, and your score may improve rapidly.

How to Shop for a Personal Loan

The final tip for getting the best personal loan interest rate is to compare offers from competing lenders. Interest rates for personal loans vary widely, even for the same applicant. The more offers you get, the more confident you can be that the one you choose is fair and economical.

The easiest way to obtain several quotes fast is to simply complete the request form on MoneyRates. When the lenders all have the same information about you – loan amount, term, etc., they can provide quotes you can easily compare. Then choose the lender offering the best terms for your needs.

Frequently Asked Questions (FAQ)

What is a personal loan calculator, and how does it work?

A personal loan calculator is a financial tool that helps you estimate your potential monthly payments and the overall cost of a personal loan. You input the loan amount, interest rate, and loan term, and the calculator provides you with an estimate of your monthly payments. It’s a valuable resource for understanding the financial implications of taking out a personal loan.

How can a personal loan help me with debt consolidation?

Personal loans are often used for debt consolidation because they can simplify your finances. By taking out a personal loan, you can combine multiple high-interest debts, such as credit card balances, into a single, more manageable payment with a potentially lower interest rate. This can help you save money and pay off your debt more efficiently.

What factors influence the interest rate I can get on a personal loan?

Several factors can influence the interest rate on a personal loan. The most significant factor is your credit rating, with individuals having higher credit scores typically qualifying for lower interest rates. Additionally, the loan term and the amount you borrow can affect the interest rate. Shopping around for offers from different lenders and considering your debt-to-income ratio can also help you secure a better interest rate on your personal loan.