Payments during interest-only period. The Interest-Only Loan Calculator takes loan amount, interest rate, interest-only period, total loan term and returns monthly payment during the interest-only period plus monthly payment after it ends, increase when repayments start, interest paid during the interest-only years. Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
The headline interest rate is only part of what a loan costs: fees, the structure of repayments and how the rate is quoted (flat or reducing) all change the true cost. Compare offers on total interest and effective rate, not on EMI alone. Use the worked example below to check the maths against your own figures.
How the Interest-Only Loan Calculator works
Paying only interest keeps early payments low but nothing is repaid, so the later payments are higher than a normal loan's. The jump when repayments start is the figure to plan for.
Worked example
With the example values (loan amount of $500,000, interest rate of 7%, interest-only period of 5 years, total loan term of 25 years), the monthly payment during the interest-only period is $2,916.67; monthly payment after it ends $3,876.49, increase when repayments start $959.83, interest paid during the interest-only years $175,000.00. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
Related Calculators
Frequently Asked Questions
How is monthly payment during the interest-only period calculated?
interest-only payment = amount × rate ÷ 12; afterwards the full amount amortises over the remaining term.
Which figures do I need?
Loan amount, interest rate, interest-only period, total loan term. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Does the result include fees and charges?
Only where there is a fee input. Processing fees, insurance and prepayment charges add to the true cost; the APR and loan comparison calculators include them.
