Before you sign that loan agreement, you need to know one number: your monthly payment. Not a rough estimate—the actual amount that'll leave your account every month for the next several years.

This debt service calculator gives you that number in seconds. Enter your loan amount, interest rate, and repayment term, and you'll see exactly what you'll owe each month, how much interest you'll pay over the life of the loan, and the true total cost of borrowing.

Whether you're weighing two personal loan offers that look similar on paper, figuring out how much car actually fits your budget, or debating between paying off a loan in 3 years versus 5—the math matters. We're often talking about differences of hundreds or thousands of dollars. Run the numbers before you commit.

When you borrow money, you're agreeing to pay back what you borrowed (the principal) plus a fee for borrowing it (interest). Your lender packages this into equal monthly payments spread across your loan term. This recurring payment obligation is called your debt service.

Here's what most people don't realize: your payment stays the same each month, but where that money goes changes over time.

Early on, the bulk of your payment covers interest. As your balance drops, more of each payment goes toward actually paying down what you owe. This gradual shift is called amortization—and it's why making extra payments early saves you the most money. You're shrinking the balance that interest gets calculated on.

Three things determine your monthly debt service:

These three factors create trade-offs. Understanding them puts you in control of the decision.

Lenders calculate your payment using a standard amortization formula:

Monthly Payment = P × [r(1+r)^n] / [(1+r)^n - 1]

Where:

• P = Principal (your loan amount)
• r = Monthly interest rate (annual rate ÷ 12)
• n = Number of payments (years × 12)

Let's work through a real example:

Say you're borrowing $10,000 at 8% interest for 3 years.

• P = $10,000
• r = 0.08 ÷ 12 = 0.00667
• n = 3 × 12 = 36 payments

Plug those in and your monthly payment comes to $313.36.

Over 36 months, you'll pay $11,281 total. That means $1,281 goes purely to interest—the cost of borrowing.

You don't need to calculate this yourself (that's what the calculator is for). But seeing the formula helps you understand why even small changes in rate or term ripple through to your final cost.

1. Enter Your Interest Rate This is the annual rate from your loan offer—usually labeled "APR" or "Interest Rate." If you're comparing multiple offers, run each one separately. The differences might surprise you.

2. Set Your Loan Term How many years will you take to pay this off? Personal loans typically range from 1 to 7 years. Shorter terms mean higher monthly payments but less interest overall.

3. Enter the Loan Amount This is the actual amount you're borrowing—not the purchase price if you're putting money down.

4. Review Your Results You'll see three numbers:

• Monthly Payment – What's due each month
• Total Payment – Everything you'll pay over the loan's life
• Total Interest – The true cost of borrowing

Play with the inputs. Bump the term up a year, drop the rate by a point—see what moves the needle.

Each number tells you something different about this loan.

Monthly Payment This is what hits your budget every single month until the loan is gone. Before you commit, gut-check this against your income. A common rule: keep total monthly debt payments under 35-40% of your gross income. But you know your budget better than any rule does.

Total Payment This is the full amount walking out of your pocket. When you're comparing loans, this number cuts through the noise. Two loans might have similar monthly payments but wildly different totals.

Total Interest Here's the real cost of borrowing—the price tag on using someone else's money. On a $15,000 loan, the gap between a decent rate and a mediocre one can easily be $2,000+. That's a vacation. A few months of car payments. Real money worth fighting for.

This is the decision every borrower faces: lower payments now, or less interest overall?

Let's make it concrete.

$15,000 Loan at 10% Interest

The 5-year option frees up $165 per month. But you'll hand over an extra $1,697 in interest by the time you're done.

Neither choice is wrong. It depends on what matters more to you right now.

Go shorter if:

• The higher payment fits your budget without strain
• You hate the idea of debt hanging around
• Minimizing total cost is your priority

Go longer if:

• Cash flow is tight and flexibility matters
• You'd put the payment difference toward higher-interest debt or investments
• You're building an emergency fund first

The calculator lets you see both paths clearly. That's the point.

People underestimate how much rates matter. Small differences compound into serious money.

$20,000 Loan for 4 Years

Going from 6% to 12% costs you an extra $2,742. For what? Nothing. Just the privilege of borrowing.

This is why rate shopping matters. I've seen people save thousands just by checking with a credit union or comparing one more online lender. A few hours of effort can pay for itself many times over.

Your rate isn't handed down from above—several factors influence what lenders will offer you.

Credit Score The biggest lever you have. Scores above 720 unlock the best rates. Below 670, you'll pay a premium. If your score is borderline, waiting a few months to improve it might save you more than rushing into a loan now.

Debt-to-Income Ratio Lenders look at how much of your income already goes to debt. If you're carrying balances, paying some down before applying can bump you into a better rate tier.

Shop Around—Seriously Rates vary wildly between lenders. Banks, credit unions, online lenders—they're all pricing differently. Get quotes from at least 3-5 places. When done within a 14-day window, multiple credit inquiries count as one on your report.

Consider Secured Loans If you can offer collateral—a car title, savings account, certificate of deposit—you'll typically get a lower rate. The lender has less risk, and they price accordingly.

Shorter Terms Often Mean Lower Rates Many lenders offer better rates on shorter loans. Sometimes the rate drop partially offsets the higher payment.

Paying more than your minimum accelerates your payoff and cuts your interest bill. Here's how much:

$25,000 Loan at 9% for 5 Years

An extra $100 per month gets you out 13 months early and saves $1,847.

Extra payments work best when:

• You're early in the loan (interest front-loads)
• Your rate is on the higher side
• You've already got emergency savings set aside

Skip extra payments if:

• You have higher-interest debt elsewhere—attack that first
• You're one flat tire away from financial stress
• Your loan has prepayment penalties (uncommon, but read the fine print)

This calculator uses the same amortization formula lenders use for fixed-rate installment loans. Your actual payment might differ slightly based on how your lender rounds, whether fees get rolled in, or the exact funding date.

For the precise amount, check your loan agreement. This tool is for planning, comparing, and making sure you're walking into the decision with your eyes open.

If you're weighing a major loan—something that'll shape your finances for years—talking to a financial advisor can help you see angles you might miss.

Run a few scenarios. Compare the options. That's exactly what this calculator is here for.