Compare two loans side-by-side to see which one is cheaper. Enter the principal, interest rate, term, and fees for each loan to instantly compare monthly payments, total interest, total cost, and savings. Find the better loan in seconds.
To compare two loans, look at three key numbers: the monthly payment, total interest paid over the life of the loan, and total cost (principal + interest + fees). A lower interest rate does not always mean a cheaper loan — a longer term can have a lower monthly payment but cost more in total interest. This calculator shows all three numbers side-by-side so you can make an informed decision.
Not necessarily. A lower monthly payment often means a longer loan term, which means you pay more total interest over time. If cash flow is your priority, the lower payment may be the right choice. If minimizing total cost is your goal, the loan with lower total interest is better — even if the monthly payment is higher. Use this calculator to see the tradeoff.
APR (Annual Percentage Rate) includes the interest rate plus certain fees, giving you a more complete picture of the loan cost. A loan with a 5% interest rate and $2,000 in fees might have an APR of 5.5%, while a loan with a 5.25% rate and no fees might have an APR of 5.25%. The APR makes it easier to compare loans with different fee structures.
The monthly payment for an amortizing loan is calculated using the formula: M = P * r * (1+r)^n / ((1+r)^n - 1), where P is the principal, r is the monthly interest rate (annual rate divided by 12), and n is the total number of payments (term in years times 12). This formula assumes fixed-rate, fully amortizing loans.
Yes. Upfront fees (origination fees, closing costs, points) increase the effective cost of the loan. This calculator lets you enter fees for each loan and includes them in the total cost calculation. A loan with a lower rate but high fees may cost more than a loan with a slightly higher rate and no fees, especially if you sell or refinance early.