Loan Comparison Calculator
The Loan Comparison Calculator pits two loan offers against each other — different rates, terms or amounts — showing the monthly payment, total interest and total cost of each so you can pick the cheaper one.
What this means
A lower rate isn't always the cheaper loan if the term differs. Comparing both scenarios shows the true difference in interest and payments.
How we calculate it
Formula
Each loan: M = P × [ r(1 + r)^n ] / [ (1 + r)^n − 1 ]. Compare M, total interest and total paid.Worked example
$25,000 at 5% for 60 months vs $25,000 at 4.5% for 72 months:
- 1Loan A payment ≈ $471.78, total interest ≈ $3,307
- 2Loan B payment ≈ $396.51, total interest ≈ $3,549
- 3Loan A costs $242 less in interest despite a higher payment
Important assumptions
- Both loans are fully amortizing with fixed rates.
- No fees are included in either offer.
Frequently asked questions
Which loan is better: lower rate or shorter term?
It depends on your cash flow. A shorter term costs more monthly but less overall; a lower rate reduces both when the term matches. Use the comparison to see your numbers.
Should I compare by APR?
Yes — APR includes fees, so it reflects the true annual cost better than the interest rate alone.