Annuity Payment Calculator
A level repayment is the amount that, paid every period for the whole term, exactly exhausts what you borrowed — no more, no less. That is not an approximation but a definition, and it means the answer can be checked directly: discount every one of the payments back to today, add them up, and the total must be the original loan. This shows that check alongside the figure.
What this generator does
Computes the level payment from the standard annuity formula, then reports the total paid, the interest component, and the present value of every scheduled payment discounted back at the same rate. That last figure must return the principal, and the check enforces it.
How to use this tool
- Enter the amount borrowed, the annual rate and the term in years.
- Read the payment, the total paid and how much of it is interest.
- Check the discounted total against the principal — they must match.
- Lengthen the term and watch the payment fall while total interest rises.
Understanding the controls
- Amount borrowed
- The principal to be repaid in full over the term, between 100 and ten million.
- Annual rate
- The nominal annual rate, divided by twelve for monthly periods — the usual quoting convention rather than a true annual equivalent.
- Years
- The full term, between 1 and 40 years. Every extra year lowers the payment and raises the total interest.
Common use cases
- Working out a level repayment for a loan or a lease
- Teaching present value with an identity that can be verified
- Showing the cost of a longer term in total interest
- Worked examples for a finance course
- Checking a repayment figure against the standard formula
How this generator works
The annuity factor is the present value of one unit paid every period for the term, and dividing the principal by that factor gives the payment. At a zero rate the formula degenerates and the payment is simply the principal split evenly, which is handled explicitly rather than left to divide by zero. The verification discounts each payment individually rather than reusing the factor, so the check does not share arithmetic with the calculation.
Randomness and fairness
No randomness at all. The payment is fully determined by the principal, rate and term you enter.
For how randomness is produced across the whole site, see how Generate Random works.
Limitations and good to know
- Level payments only — interest-only periods, offset accounts and early repayment are not modelled.
- The nominal rate is divided by twelve rather than compounded to a true monthly equivalent, matching how loans are usually quoted.
- No fees, insurance or charges are included, so a real total cost will be higher.
- Payments are assumed to arrive at the end of each period.
- This is an arithmetic tool, not financial advice.
Privacy and your data
The calculation runs in your browser alone. The figures you enter are never transmitted, logged or stored.
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