How to Use the Equal Payment vs Equal Principal Loan Calculator
Most installment loans use one of two repayment structures: equal payment (fully amortizing) or equal principal. Which one you pick changes both how much you pay early on and how much interest you pay in total, so it's worth comparing before you sign. Enter your loan amount, annual rate, and term, and this calculator shows both side by side.
Equal payment loans combine principal and interest into one fixed payment for the life of the loan. Early payments are mostly interest, and the principal share grows over time. Payments are predictable and easy to budget for, but because the balance falls more slowly, total interest ends up higher than an equal-principal loan.
Equal principal loans split the principal evenly across the term and add interest on the remaining balance each month. Payments start high and shrink every month, so the early burden is heavier — but the balance drops faster, which means less total interest over the life of the loan.
Frequently Asked Questions
With equal-principal payments you pay down more principal early on, so the balance drops faster and less interest accrues over time. That means equal-principal loans usually cost less total interest than equal-payment loans, though early payments are higher.
Equal-payment (amortizing) loans, since you pay the same fixed amount every month. Early payments are lower than equal-principal loans, but because the balance falls more slowly, total interest ends up higher.