Personal Loan Interest-Only Calculator
This calculator estimates monthly interest-only payments, the outstanding principal after an interest-only period, and the fixed amortizing payment that would apply if the remaining balance is repaid over the rest of the loan term. Use it to compare scenarios or to validate lender quotes.
Results assume a fixed nominal interest rate, periodic compounding at the payment frequency you specify, and level (fixed) amortizing payments when amortization is selected. Values are estimates for planning purposes only and do not replace lender disclosures.
Calculates interest-only payments for the initial period, then computes the fixed amortizing payment for the remaining term (standard level-payment amortization).
Inputs
Results
Monthly interest-only payment (initial period)
$41.67
Monthly amortizing payment after interest-only period
$299.71
Remaining amortization months
36
Total interest paid (all periods)
$1,789.52
Total amount paid (principal + interest)
$11,789.52
| Output | Value | Unit |
|---|---|---|
| Monthly interest-only payment (initial period) | $41.67 | currency |
| Monthly amortizing payment after interest-only period | $299.71 | currency |
| Remaining amortization months | 36 | — |
| Total interest paid (all periods) | $1,789.52 | currency |
| Total amount paid (principal + interest) | $11,789.52 | currency |
Visualization
Methodology
Monthly or periodic interest-only payment is calculated as principal multiplied by the periodic nominal rate (annual rate divided by payments per year).
When amortization follows an interest-only period, the remaining balance (equal to the original principal under interest-only) is repaid using the standard level-payment amortization formula. If the periodic rate is zero, the amortizing payment is calculated as remaining principal divided by remaining months.
This tool is developed with quality and numeric accuracy practices in mind. Numeric operations follow IEEE 754 floating-point conventions where supported; development and testing follow quality management principles aligned with ISO 9001, and security best practices reference NIST guidelines. Results are for estimation only; always compare with lender-provided amortization schedules and disclosures.
Worked examples
Example 1: $10,000 loan, 5% annual, 2-year interest-only, 5-year total term, monthly payments. Interest-only monthly ≈ $41.67. Remaining 36 months amortize balance of $10,000 — monthly amortizing payment ≈ $299.71.
Example 2: Zero nominal interest. If annual rate is 0% and an amortization period exists, amortizing payment = principal / remaining months.
Further resources
Expert Q&A
Does this calculator include fees or APR?
No. This estimator uses the nominal interest rate you enter and does not add origination fees, insurance, or other lender fees. APR (annual percentage rate) includes certain fees and compounding and may differ from the rate used here.
What happens after the interest-only period ends?
If you select 'interest-only then amortize', the calculator computes a fixed payment that repays the outstanding principal over the remaining scheduled months. If you select 'interest-only only', the balance remains outstanding at the end of the period (no amortization is computed).
How accurate are the results?
Calculations follow standard financial formulas and IEEE floating-point conventions, but rounding and lender-specific conventions (daily interest accrual, payment application rules, escrow requirements) can produce small differences. Use results for planning and verify with lender disclosures.
Can periodic compounding differ from payment frequency?
This calculator assumes compounding occurs at the payment frequency you select (payments per year). If a lender uses different compounding or accrual rules, results may differ.
Sources & citations
- NIST – National Institute of Standards and Technology — https://www.nist.gov
- ISO – International Organization for Standardization (quality management principles) — https://www.iso.org
- IEEE 754 (floating-point arithmetic standard reference) — https://standards.ieee.org/standard/754-2019.html
- OSHA – Occupational Safety and Health Administration (organizational safety standards) — https://www.osha.gov