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Interest-Only Loan Calculator

Works out the payment during an interest-only period, the higher payment once the loan recasts over its remaining term, and how much more interest that costs than repaying from the start.

Payment during the interest-only period
1,500.00
Interest-Only Loan Calculator
Payment once it recasts
1,932.90
Balloon due at the end
0.00
Total paid
669,871.26
Total interest
369,871.26
Payment if repaid from the start
1,798.65
Total paid if repaid from the start
647,514.57
Interest if repaid from the start
347,514.57
Extra interest the interest-only period costs
22,356.69
Payment increase when it recasts
432.90
Worked out from Consumer Financial Protection Bureau, What is an interest-only loan? and 1 other source.
The payment rises from 1500 to 1932.9 after 60 month(s) — an increase of 432.9. Nothing paid before then reduces the balance.
Recasting over the remaining term is the usual market convention rather than a legal requirement; a particular lender’s contract may differ.

Your figures

Updates as you type
Set this equal to the total term for a loan that never repays principal, leaving a balloon.

How this is worked out

4 steps
  1. Monthly rate = 6% ÷ 12 = 0.5%
  2. Interest-only payment = 300000 × 0.005 = 1500
  3. After 60 month(s) the full 300000 is repaid over 300 month(s): 1932.9 a month
  4. Total interest 369871.26 against 347514.57 on an ordinary repayment loan

Its 3 worked examples are re-run on every release, last on 15 September 2026. What changed

Sources and references

2 sources
Consumer Financial Protection Bureau, What is an interest-only loan?
Describes the structure: payments cover interest only for a set period, after which the payment rises because the principal must then be repaid.
Regulation Z, 12 CFR §1026.37(a)(10), loan product disclosure
Requires an interest-only feature and its duration to be disclosed. Recasting over the remaining term is market convention; the regulation does not prescribe the method.

What this calculator does

Works out the payment during an interest-only period, the higher payment once the loan recasts over its remaining term, and how much more interest that costs than repaying from the start.

How to use Interest-Only Loan Calculator

Enter Loan amount, Annual interest rate, Total term and Interest-only period. The calculator checks the values, applies the stated method, and updates the result without saving your figures.

What the result means

The result includes Payment during the interest-only period, Payment once it recasts, Balloon due at the end, Total paid, Total interest, Payment if repaid from the start, Total paid if repaid from the start, Interest if repaid from the start, Extra interest the interest-only period costs and Payment increase when it recasts. Review the visible working and any warnings before using the answer for a decision.

Method and checks

The method cites Consumer Financial Protection Bureau, What is an interest-only loan?; Regulation Z, 12 CFR §1026.37(a)(10), loan product disclosure. Its 3 built-in worked examples are checked on every full test run. The initial answer and working are rendered on the server, so they remain readable without JavaScript.

Results are general information, not financial, tax, legal, medical or engineering advice. Check any decision that matters with a qualified professional.

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Copy this code into any page. The calculator appears with the figures currently entered, sizes itself to fit, and a small credit line links back here. Free, no account, no ads inside it, no tracking of your readers. Set your own figures and fixed fields; Personal removes the credit line, sets your colour and shows you which sites use it.

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