Personal Loan Calculator

How the Personal Loan Calculator Works

This personal loan calculator helps you estimate your loan payments based on the loan amount, interest rate, term length, and payment frequency. It calculates both your regular payment amount and the total interest you'll pay over the life of the loan.

Understanding Personal Loan Payments

Payment Frequency Impact: The frequency of your payments affects how much interest you'll pay overall. More frequent payments (weekly or bi-weekly) mean you're paying down the principal faster, which reduces the total interest charged over the loan term.

Total Cost Breakdown: Your total cost includes both the principal (amount borrowed) and all interest charges. Comparing different loan terms shows you how longer terms reduce your payment but increase total interest paid.

Types of Personal Loans in Canada

• Secured Loans: Backed by collateral (car, home equity, investments) - typically offer lower interest rates
• Unsecured Loans: No collateral required - higher interest rates but faster approval
• Line of Credit: Revolving credit that you can draw from as needed - flexible but may have variable rates
• Debt Consolidation Loans: Combine multiple debts into one payment - can simplify finances and potentially lower rates

Tips for Getting a Personal Loan

• Check your credit score: Better scores qualify for lower rates - check for free with Borrowell or Credit Karma
• Compare multiple lenders: Banks, credit unions, and online lenders may offer different rates
• Consider the total cost: Don't just look at the monthly payment - calculate total interest paid
• Read the fine print: Watch for origination fees, prepayment penalties, and other charges
• Borrow only what you need: Taking more than necessary increases interest costs
• Choose the shortest term you can afford: Higher payments but lower total cost

Interest Rate Factors

Personal loan interest rates in Canada typically range from 6% to 30% depending on:

• Your credit score and credit history
• Whether the loan is secured or unsecured
• Loan amount and term length
• Your income and employment stability
• Current economic conditions and Bank of Canada rates