The Math Behind Loan Calculators
·5 min read
Ever wondered how banks calculate your monthly payment? Understanding the math helps you make smarter borrowing decisions.
The Loan Payment Formula
M = P x [r(1+r)^n] / [(1+r)^n - 1]
- P = Principal (loan amount)
- r = Monthly interest rate
- n = Number of payments
Why Extra Payments Help
Paying just $100 extra monthly on a $200,000 loan can save you over $50,000 in interest!
Calculate your loan with our free Loan Calculator.