Loan Gauge
The loan is $20,000. Slide the term until the needle sits in the green band, then lock in.
How to play Loan Gauge
Each round gives a $20,000 loan at a fixed interest rate and a target monthly payment, shown as a green band on a gauge. Slide the loan term between 12 and 84 months and watch the needle move. Press Lock in when it sits in the green band, within about 3% of the target.
The math behind it
A loan payment depends on the amount, the rate and the term: payment = P × r ÷ (1 − (1 + r)⁻ⁿ), where r is the monthly rate and n the number of months. A longer term lowers the monthly payment but raises the total interest you pay.
For example, $20,000 at 6% for 48 months is about $470 a month and $2,560 in interest. Stretch it to 72 months and the payment falls to about $331, but the interest rises to about $3,830.
Why term matters
Lenders often sell a loan by its monthly payment, so a low payment can hide a long term and a high total cost. The loan payment and auto loan calculators show the full picture, including total interest, fees and sales tax.
Frequently asked questions
How is a monthly loan payment calculated?
payment = P × r ÷ (1 − (1 + r)⁻ⁿ), with r the monthly rate and n the number of months.
Does a longer term save money?
It lowers the monthly payment but increases the total interest, so the loan costs more overall.
How close do I need to get to the target?
Within about 3% of the target payment, the green band on the gauge.
Is Loan Gauge free?
Yes. It runs in your browser with no sign-up.
Related calculators
- Loan Payment Calculator: Loan payment calculator: find the monthly payment, total interest and total cost of any fixed-rate personal or business loan.
- Auto Loan Calculator: Auto loan calculator: monthly car payment with sales tax, fees, trade-in and down payment, plus total interest.
- Compound Interest Calculator: Compound interest calculator: see how savings or investments grow with monthly, quarterly or daily compounding over time.
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