Loan Term Calculator
Find out how long it takes to pay off a loan given the amount, rate, and monthly payment. Free online loan term / payoff calculator.
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n = −ln(1 − (P × r) / PMT) / ln(1 + r)
−ln(1 − (500000 × 0.007083) / 10000.00) / ln(1 + 0.007083) ≈ 62 months
5 yr 2 mo
62 monthly payments
Total Interest Paid
$120000.00
Total Paid
$620000.00
Principal
$500000.00
How Does the Loan Term Calculator Work?
Enter the loan amount, the annual interest rate, and the monthly payment you can afford. The calculator uses the closed-form loan formula n = −ln(1 − (P × r) / PMT) / ln(1 + r), where P is the principal, r is the monthly interest rate (annual rate divided by 12), and PMT is the monthly payment. The result is the number of months it takes to fully clear the loan. If your payment does not even cover the interest accruing each month, no repayment term exists and the calculator warns you instead.
Example
Take a $500,000 loan at 8.5% per year with a $10,000 monthly payment. The monthly rate is 0.7083% and the formula gives about 62 months, so the loan clears in roughly 5 years and 2 months. Over that period you pay about $620,000 in total, of which around $120,000 is interest. Paying $15,000 a month instead would cut the term and slash the interest bill.
Common Use Cases
- Planning how quickly you can retire a home, car, or personal loan.
- Comparing payoff timelines for different monthly payment amounts.
- Deciding whether a bigger EMI is worth the reduced interest cost.
- Setting repayment goals for debt consolidation plans.
FAQs
Why does my loan never get paid off?
If your monthly payment is equal to or less than the interest charged that month (P × r), the principal never decreases. No number of payments can finish the loan, so the calculator shows a warning instead of a misleading number.
What happens if I pay extra each month?
Every rupee or dollar over the monthly interest goes straight to the principal. This shortens the term and reduces the total interest paid, which is why even small extra payments help.
Why is the result rounded up?
The formula can produce a fractional number of months. Since payments are made in whole months, an exact payoff requires rounding up to the next full month for the final balance to be fully cleared.