Loan Comparison Calculator
Compare two loans side by side.
See monthly payments, total interest, and total cost to find the better deal.
Loan Comparison helps you evaluate two loan offers side by side to determine which one costs less over the full term.
Monthly Payment Formula:
M = P × [r(1+r)^n] / [(1+r)^n - 1]
Where:
- M = Monthly payment
- P = Principal (loan amount)
- r = Monthly interest rate (annual rate / 12)
- n = Total number of payments (years × 12)
Total Interest:
Total Interest = (M × n) - P
Total Cost:
Total Cost = M × n
What to Compare: When comparing two loans, the lowest monthly payment is not always the best deal. A longer term may have lower monthly payments but cost significantly more in total interest.
Example:
- Loan A: $200,000 at 6.5% for 30 years = $1,264/month, $255,088 total interest
- Loan B: $200,000 at 6.0% for 15 years = $1,688/month, $103,788 total interest
Loan B has higher monthly payments (+$424/month) but saves $151,300 in interest over the life of the loan.
Key Factors:
- Interest rate: Even a 0.25% difference can mean thousands over the loan term.
- Loan term: Shorter terms mean higher payments but much less total interest.
- Loan amount: Sometimes borrowing slightly less makes a significant difference.
- APR vs. rate: The APR includes fees and is the true cost of borrowing.
Common Loan Types:
| Type | Typical Term | Rate Range |
|---|---|---|
| 30-year mortgage | 30 years | 5.5–7.5% |
| 15-year mortgage | 15 years | 5.0–7.0% |
| Auto loan | 3–7 years | 4.0–12.0% |
| Personal loan | 2–7 years | 6.0–36.0% |
| Student loan | 10–25 years | 4.0–8.0% |
Tips:
- Always compare total cost, not just monthly payment.
- Factor in your monthly budget: a lower-cost loan is useless if you cannot make the payments.
- Consider refinancing options if rates drop after you take a loan.
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