Monthly payment on a $30,000 student loan at 5% for 10 years
A $30,000 loan at 5% over 10 years costs $318.20 a month. You pay $8,184 in interest, $38,184 in total.
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The numbers for these inputs
| Year | Principal paid | Interest paid | Balance left |
|---|---|---|---|
| 1 | $2,372 | $1,446 | $27,628 |
| 2 | $2,494 | $1,325 | $25,134 |
| 3 | $2,621 | $1,197 | $22,513 |
| 4 | $2,755 | $1,063 | $19,758 |
| 5 | $2,896 | $922 | $16,861 |
| 6 | $3,044 | $774 | $13,817 |
| 7 | $3,200 | $618 | $10,617 |
| 8 | $3,364 | $454 | $7,253 |
| 9 | $3,536 | $282 | $3,717 |
| 10 | $3,717 | $101 | $0 |
How it works
A fixed-rate loan is repaid with the same payment every month. The payment is chosen so that, after the last one, the balance is exactly zero: payment = amount x r / (1 - (1 + r)^-n), where r is the monthly rate (yearly rate / 12) and n is the number of months.
Each month the interest is the balance times r. The rest of the payment reduces the balance. Early on most of the payment is interest; later most of it is principal, which the year-by-year table shows.
The result does not include fees, insurance, taxes or a variable rate. Your lender's figure can differ a little, so use this to compare options, then ask for the official schedule.
Common mistakes
- Comparing loans by monthly payment alone: a longer term lowers the payment but raises the total interest.
- Forgetting that the quoted rate and the APR can differ once fees are included.
- Not checking whether extra payments go to principal; paying a little extra early saves the most interest.
- Using the headline rate for a variable-rate loan, which can rise.
Questions
What is the monthly payment on $30,000 at 5%?
$318.20 a month for 120 months, assuming a fixed rate and equal payments.
How much interest will I pay in total?
$8,184, which is 27.28% of the amount borrowed. The total repaid is $38,184.
How do I pay less interest?
Choose a shorter term, make a larger down payment, or pay extra toward the principal. Change the term slider to see the trade-off between payment and total interest.
Does this include fees or insurance?
No. It covers principal and interest only. Add origination fees, insurance or property taxes separately; for a mortgage they can add a large share to the monthly cost.
Why is the first year mostly interest?
Interest is charged on the remaining balance, which is highest at the start. As the balance falls, a larger part of each equal payment goes to principal.
More loan payment examples
- Monthly payment on a $20,000 car loan at 7% for 5 years
- Monthly payment on a $30,000 car loan at 6.5% for 6 years
- Monthly payment on a $10,000 personal loan at 9% for 3 years
- Monthly payment on a $5,000 personal loan at 12% for 2 years
- Monthly payment on a $50,000 student loan at 5.5% for 10 years
- Monthly payment on a $300,000 mortgage at 6.5% for 30 years
- Monthly payment on a $300,000 mortgage at 6% for 15 years
- Monthly payment on a $400,000 mortgage at 6.75% for 30 years
- Monthly payment on a $200,000 mortgage at 7% for 30 years