Loan Comparison Calculator
When you have two loan offers, it is not always obvious which one is better. A lower monthly payment can hide a much higher total cost. This comparator shows both loans in parallel — monthly payment, total amount to repay, and total interest for each — so you can choose with complete information.
Loan A
Loan B
Excludes fees, insurance, and other additional charges.
Publicidad
How it works
For each loan the fixed payment formula is applied: PMT = P × r / (1 − (1+r)^−n). The total to pay is PMT × n and the total interest is the total minus the principal. The difference between the two shows how much you save (or overpay) by choosing one option over the other. Worked example: two offers for the same $100,000 principal over 48 payments. Loan A has an 8% annual rate and Loan B a 10% rate. The payment for Loan A is $2,441.29 (total $117,182.03; interest $17,182.03) and for Loan B $2,536.26 (total $121,740.40; interest $21,740.40). Even though they look similar, Loan A wins: you pay $95 less per month and $4,558.37 less in total. Watch out: if Loan A charged fees or insurance that B does not, that edge could shrink — which is why you should compare the total cost, not just the rate.
Compared example: $100,000 over 48 payments, 8% vs 10%
Both loans finance the same principal over the same term; only the rate changes. The table shows how two points of rate translate into more than $4,500 of difference in total cost.
| Item | Loan A | Loan B |
|---|---|---|
| Principal | $100,000 | $100,000 |
| Annual rate | 8% | 10% |
| Payments | 48 | 48 |
| Monthly payment | $2,441.29 | $2,536.26 |
| Total to pay | $117,182.03 | $121,740.40 |
| Interest | $17,182.03 | $21,740.40 |
Publicidad
Preguntas frecuentes
- Does a lower monthly payment always mean a cheaper loan?
- No. A lower monthly payment usually implies a longer term, which means more months of interest. A $100,000 loan at 10% for 12 months has a payment of $8,792 and total cost of $105,499. The same loan for 24 months has a payment of $4,614 but a total cost of $110,733. The payment drops, but the cost rises by over $5,000.
- Which variable matters most when comparing loans?
- It depends on your situation. If your priority is monthly cash flow, look at the payment. If you want to minimize what you pay in total, look at total interest. In general, if you can afford the higher payment, the shorter loan is almost always more financially advantageous.
- How do I compare an installment loan with a lump-sum loan?
- For a bullet loan (single payment at the end), the total to pay is the principal plus interest for the full period: total = P × (1 + r×t). To compare it with an installment loan, enter the same amount on both sides of the comparator and adjust the terms.
- What is APR and why does it matter more than the nominal rate?
- Annual Percentage Rate (APR) includes the interest rate plus all additional charges: fees, insurance, taxes. Two loans with the same nominal rate can have very different APRs. This calculator does not include APR; always ask the lender for it before signing.
- Can I use this comparator for loans in different currencies?
- You can compare the financial structure of two loans regardless of currency, as long as both use the same one. Do not make direct comparisons between loans in different currencies without first converting to a single currency and considering exchange rate risk.
- What is the difference between the nominal rate (APR) and the effective rate (APY/EAR)?
- The nominal annual rate is split across periods without accounting for compounding; the effective annual rate (APY or EAR) reflects the real interest once it compounds month to month. A 24% nominal rate compounded monthly is equivalent to an effective rate of about 26.8%. This comparator uses the nominal rate you enter divided by 12; to compare the true cost between lenders, look at the effective rate and, better still, the total cost that adds fees and insurance.