Interest Only Loan Calculator
Calculate the monthly interest payment and total interest paid over the interest-only period for an interest-only loan.
Published by:
isCalculator Editorial Team
Was this calculator helpful?
How to use this tool?
This calculator determines the monthly interest payment and total interest paid during the interest-only period of a loan.
- Enter Loan Amount – The total amount borrowed (e.g., 200000 for $200,000).
- Enter Annual Interest Rate – The yearly interest rate as a percentage (e.g., 5.5 for 5.5%).
- Enter Interest-Only Period – The number of months you pay only interest (e.g., 60 for 5 years).
- Click "Calculate" – The results appear below.
Results explained:
- Monthly Interest Payment – The fixed amount you pay each month during the interest-only period.
- Total Interest Paid – The sum of all monthly payments over the entire interest-only period.
Note: All values must be positive numbers. The interest rate is entered as a percentage (e.g., 5.5, not 0.055).
Previous Results
| Result | Inputs | Date |
|---|
Frequently Asked Questions
An interest-only loan is a loan where the borrower pays only the interest for a specified period, and the principal balance remains unchanged during that period.
The monthly interest payment is calculated by multiplying the loan amount by the monthly interest rate (annual rate divided by 12).
After the interest-only period, the loan typically converts to a fully amortizing loan, where payments include both principal and interest, or the principal becomes due as a balloon payment.
