How do I compare loan offers?

To compare loans, look at: 1) Monthly payment - what you pay each month, 2) Total interest - total extra paid over the loan term, 3) Total cost - principal plus all interest, 4) APR - the true cost including fees. Our calculator shows all these metrics side by side.

What makes one loan better than another?

The best loan typically has the lowest total cost (principal + interest). However, also consider monthly payment affordability, loan term flexibility, and any fees. A lower interest rate usually means a better deal, but shorter terms save more on interest despite higher monthly payments.

Should I choose the loan with the lowest monthly payment?

Not always. Lower monthly payments often mean longer loan terms, which results in paying more total interest. Consider both affordability (monthly payment) and total cost. If you can afford higher payments, a shorter-term loan saves money overall.

What's the difference between interest rate and APR?

Interest rate is just the percentage charged on the loan principal. APR (Annual Percentage Rate) includes the interest rate plus all fees and costs, giving you the true cost of borrowing. This calculator uses interest rate; always check the APR when comparing real loan offers.

← All Tools

🔍 Loan Comparison Tool

Compare multiple loan options side by side to find the best deal

Loan Option 1

Loan Amount ($)

Interest Rate (%)

Loan Term (Years)

Loan Option 2

Loan Amount ($)

Interest Rate (%)

Loan Term (Years)

Loan Option 3

Loan Amount ($)

Interest Rate (%)

Loan Term (Years)

📊 Loan Comparison

Metric	Loan 1	Loan 2	Loan 3
Monthly Payment	$0	$0	$0
Total Interest Paid	$0	$0	$0
Total Cost	$0	$0	$0
Best Option?	-	-	-

📖 How to Use This Calculator

1. Enter Loan Details

For each loan option, enter the loan amount, annual interest rate (as a percentage), and loan term in years.

2. Review the Comparison

The table shows monthly payments, total interest paid, and total cost for each loan side by side.

3. Identify the Best Option

The calculator highlights which loan has the lowest total cost, helping you make an informed decision.

4. Consider Your Needs

While the lowest total cost is often best, also consider if you can afford the monthly payment and if the loan term fits your timeline.

💡 Understanding Loan Comparison

What to Look For

When comparing loans, focus on:

Monthly Payment: Can you comfortably afford this amount each month?
Total Interest: How much extra are you paying beyond the principal?
Total Cost: The sum of principal and all interest - the true cost of the loan
Loan Term: Shorter terms mean higher payments but less interest overall

Monthly Payment Formula

Monthly payments are calculated using the standard loan amortization formula:

M = P × [r(1+r)^n] / [(1+r)^n - 1]

Where M = monthly payment, P = principal, r = monthly interest rate, n = number of payments

Interest Rate vs Loan Term

Both interest rate and loan term significantly impact your total cost. A lower rate always saves money, but a shorter term can save even more despite higher monthly payments. For example:

$200,000 at 6% for 30 years = $231,676 total interest
$200,000 at 6% for 15 years = $103,788 total interest

The 15-year loan saves over $127,000 in interest!

❓ Frequently Asked Questions

Which loan should I choose?

Generally, choose the loan with the lowest total cost that you can afford monthly. However, also consider: Can you afford the monthly payment? Do you prefer lower payments or paying less interest? How long do you want to be in debt?

Is a lower monthly payment always better?

No. Lower monthly payments usually mean a longer loan term, which results in paying significantly more interest over time. If you can afford higher monthly payments, a shorter-term loan saves thousands in interest.

What if loan amounts differ?

You can still compare! If one lender offers a different loan amount, enter that amount for that loan. The comparison will show you which option is most cost-effective relative to what you're borrowing.

Should I consider fees and closing costs?

Yes! This calculator shows interest costs, but real loans often have origination fees, closing costs, and other charges. Add these to the total cost when making your final decision. Always compare the APR (Annual Percentage Rate) which includes fees.

Is my data private?

Yes. All calculations happen in your browser. Your data never leaves your device and is completely private.