Loan Calculator

How to use this loan calculator

If you’re looking to take out a personal loan but aren’t sure how much you can afford to borrow, this loan calculator can help you find the answer. Plug in the following information to our calculator to get started:

• Loan amount
• APR
• Repayment term

  Loan amount

Enter the loan amount you expect to borrow. This loan calculator allows you to see your estimated monthly payment on a personal loan between $1,000 and $50,000.

  APR

Enter your expected annual percentage rate (APR). The APR takes both the loan’s interest rate and fees into account to measure the total cost of borrowing.

If you’re unsure about the APR you may qualify for, you can estimate it based on your credit score. For personal loans, these are the average APRs for each credit score range:

Source: LendingTree user data for closed personal loans in the fourth quarter of 2022

  Repayment term

Choose the amount of time it will take you to repay the funds, between two and seven years. A long repayment term translates to lower monthly payments but a higher overall loan cost.

What to consider before taking out a loan

While getting a personal loan can be a straightforward process, here are a few points to consider ahead of time.

• Budget
• Fees
• Type of loan
• Creditworthiness

  Budget

You shouldn’t take out a personal loan if you can’t afford to repay it. Before signing a loan agreement with a lender, review your monthly budget to see how much flexibility you have to accommodate another monthly payment.

Specifically, you’ll want to consider your debt-to-income ratio (DTI), since this factor helps lenders determine whether you can afford new debt. Your DTI compares how much money you’re bringing in to how much you owe. Generally, you want to keep your DTI below 35%.

  Fees

One of the most common fees that comes with a personal loan is an origination fee. These fees can get as high as 10.00% of your loan amount and are typically taken out of the total balance of your loan before you receive your funds.

For instance, let’s say you want a $5,000 personal loan, but the lender charges a 5.00% origination fee. When your loan is disbursed, you’ll only receive $4,750, as your lender will take out $250 of your lump sum to cover the fee.

If you want to skip these sorts of fees, consider looking into no-fee personal loan lenders.

  Type of loan

There are two common types of personal loans: unsecured and secured. With an unsecured loan, you won’t need to offer lenders any valuable collateral to back the loan, such as a savings account or vehicle. On the other hand, secured loans do require collateral, which lenders can seize if you’re unable to repay.

Secured loans may be better suited for those with lower credit scores who own valuable collateral they may be comfortable parting with. Because these loans are backed by collateral, they may come with lower interest rates and borrowers with poor credit are more likely to qualify.

  Creditworthiness

When it comes to unsecured personal loans, your creditworthiness determines your eligibility for a loan. Lenders examine several factors when assessing your creditworthiness, including your credit score, income and credit history. They use this information to judge how likely you are to repay your debt.

Your credit scores — FICO Score and VantageScore — are calculated based on the activity on your credit reports, which can be viewed at AnnualCreditReport.com. Your credit scores are calculated based on the following factors:

• Payment history
• How much you owe
• The length of your credit history
• The types of credit you use
• Any new forms of credit