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Compare Two Loans Side by Side

Different rate, different term, same amount borrowed — see which offer actually costs less, and by how much.

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Compare Two Loans

Standard amortisation on the figures you enter. Real offers add fees, insurance, and compounding rules that change the total — treat this as a comparison, not a quote.

Why the lower monthly payment is often the more expensive loan

Stretching a loan over more years shrinks the monthly payment and grows the total interest, because you are borrowing the money for longer. A $25,000 loan illustrates it plainly:

Effect of loan term on monthly payment and total interest
Term at 6.4% APRMonthlyTotal interest
3 years$765.09$2,543.16
5 years$487.98$4,279.01
7 years$370.03$6,082.25

The seven-year option costs less than half as much each month and about $3,540 more overall. Neither is automatically the right choice — a payment you can comfortably meet has real value — but the trade needs to be visible before you can make it.

The formula

Monthly payment on an amortising loan:

M = P × i ÷ (1 − (1 + i)−n)

where P is the amount borrowed, i is the monthly rate (annual rate ÷ 12 ÷ 100), and n is the number of months. Total interest is M × n − P.

What a rate comparison leaves out

  • Fees. Origination and arrangement fees are why APR and the headline interest rate differ. Compare APR with APR.
  • Early repayment penalties. These can erase the saving from a shorter term.
  • Variable rates. A rate that can move is not comparable to a fixed one on the strength of today's number alone.
  • Compounding conventions. This tool uses standard monthly amortisation; some products compound differently.
This is a comparison tool, not financial advice, and it is not a quote. Ask any lender for the total amount repayable in writing before committing.

More than two scenarios

Two offers fit on this page. Real decisions rarely stop at two — you end up varying the deposit, the term, and the rate, and wanting all of those totals in front of you at once. CalcBoard runs up to eight independent calculator panels on one screen for exactly that, with the Premium named variables letting you set principal=25000 once and reuse it across every panel.

Frequently Asked Questions

How do I compare two loan offers?
Compare total interest and total repaid, not just the monthly payment. A longer term almost always lowers the monthly figure while raising the total cost. Compare APR against APR so fees are included.
Is a longer loan term cheaper?
It is cheaper per month and more expensive overall. On a $25,000 loan at 6.4%, moving from 3 years to 7 cuts the payment from about $765 to about $370 but adds roughly $3,500 in interest.
What is the monthly payment formula?
M = P × i ÷ (1 − (1 + i)^−n), where P is the principal, i is the monthly interest rate, and n is the number of months. Total interest is M × n − P.
Does this include fees and insurance?
No. It calculates standard amortisation on the figures you enter. Origination fees, insurance, and early-repayment penalties all change the real total, which is why APR is the fairer figure to compare.

Model more than two scenarios

Up to 8 independent panels, exact decimal maths, and variables shared across all of them.

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