Two-Loan Comparison Calculator
Compare two loan offers side by side — monthly payment and total interest — to see which one actually costs less over its full term.
How it works
For each loan: payment = P·r ÷ (1 − (1+r)^−n), r = APR÷12 · Total repaid = payment × n · Total interest = total repaid − principal · Compare totals
The lowest monthly payment is not always the cheapest loan. A longer term lowers the payment but stretches interest over more months, often making the total cost higher even at the same rate. Comparing total interest and total repaid — not just the monthly figure — reveals which offer really costs less.
Worked example
Loan A: $25,000 at 6.5% for 5 years is about $489/mo and $4,340 total interest. Loan B: $25,000 at 4.9% for 6 years is about $402/mo but $3,930 total interest. Loan B has the lower payment and, here, slightly lower total interest — but a longer term can flip that, so always check both.
Frequently asked questions
Should I pick the lower monthly payment?
Not automatically. A smaller payment usually comes from a longer term, which can mean paying more interest overall. Weigh the monthly payment you can afford against the total cost of the loan.
Does a lower rate always win?
Usually, but not if it comes with a much longer term or high fees. A lower rate over 7 years can cost more total interest than a higher rate over 3 years. Compare total repaid to be sure.
What about fees and points?
This tool compares interest only. Origination fees, points and closing costs add to the real cost, so fold them into each loan's amount or compare APRs, which bundle certain fees into the rate.
Related calculators
Educational estimate only — not financial, tax or lending advice. Confirm exact figures with your lender.