Loan Payoff Time Calculator
Enter your current loan balance, annual interest rate, and the monthly payment you plan to make. This calculator solves for the number of months required to pay off the loan using the formula n = -ln(1 - r*P/M) / ln(1+r), where r is the monthly rate (APR / 12), P is the outstanding balance, and M is the fixed monthly payment. The result tells you exactly when your loan will be paid off and how much total interest you will pay. This is useful when deciding whether to increase monthly payments to shorten the loan term and reduce interest costs.
Loan payoff time formula
n = -ln(1 - r*P/M) / ln(1+r)
Where n is months to payoff, r is the monthly interest rate (annual rate / 12 / 100), P is the current balance, and M is the monthly payment. Total interest = (M * n) - P. If r*P >= M, the loan never pays off.
How payment size affects payoff time
Increasing your monthly payment by even a small amount can significantly shorten the loan term. Because each extra dollar reduces principal faster, subsequent months accrue less interest, further accelerating payoff. For example, on a $5,000 balance at 12% APR, raising the monthly payment from $150 to $200 cuts roughly 14 months off the payoff time and saves substantial interest. Use this calculator to experiment with different payment scenarios before committing to a plan.
Frequently asked questions
How do I calculate how long it will take to pay off a loan?
Use the formula n = -ln(1 - r*P/M) / ln(1+r), where n is months, r is the monthly rate, P is the balance, and M is the monthly payment. The payment must exceed the monthly interest (r * P) or the loan will never be paid off.
What happens if my payment is less than the monthly interest?
If your payment does not cover the interest, your balance grows each month. This is called negative amortization. The loan will never be paid off. You must pay at least P * r (principal times monthly rate) to make progress.
How does making extra payments reduce payoff time?
Extra principal payments reduce the outstanding balance, which lowers the interest charged next month. This allows more of each subsequent regular payment to go to principal, compounding the time savings.
Does the payoff time change if interest is compounded daily?
Some lenders compound interest daily rather than monthly. For daily compounding, the effective monthly rate differs slightly. This calculator uses monthly compounding, which is standard for most US personal loans.
What is a good monthly payment amount for a personal loan?
The CFPB recommends that total monthly debt payments do not exceed 43% of gross monthly income (the common back-end DTI limit for qualified mortgages). For personal loans, keeping debt payments below 20% of take-home pay is a common guideline.
Official sources
- Consumer Financial Protection Bureau (CFPB): Personal Loans.
- Federal Reserve Consumer Credit (G.19): Consumer Credit Release.
Reviewed by the CalculatorHub team, edited by James Graham, 15 June 2026. See our methodology.