Finance

Personal Loan Calculator

Calculate your monthly loan payment, total interest and final cost using the French amortisation system.

A personal loan is an unsecured credit in which a lender advances you a sum of money that you repay in monthly instalments over an agreed term. Unlike a mortgage, it is not backed by a property asset, so interest rates tend to be higher. The monthly payment includes both the repayment of principal and the interest for that period.

This calculator uses the French amortisation system, the most common in Spain and Europe, in which the monthly payment stays constant but the split between principal and interest changes every month. It shows you the total cost of the loan including interest, so you can compare different offers objectively.

Loan details

Loan amount

500 €100.000 €

Annual interest rate (TIN)

0 %20 %

Term

1 yr10 yr

Results are indicative. Always compare the APR (not just the nominal rate) between lenders before taking out a loan.

How a loan payment is calculated

The payment comes from the French system formula: payment = C · i / (1 − (1+i)^−n), where C is the principal, i the monthly interest rate (the annual nominal rate divided by 12) and n the total number of monthly instalments. The result is a constant payment for the whole life of the loan. What changes month to month is its composition: at the start most of it goes to interest and only a small part repays principal; as the outstanding debt falls, interest shrinks and you repay more principal each month.

Worked example

For a €15,000 loan at a nominal rate of 8% over 5 years: the monthly rate is 0.08 / 12 = 0.006667 and the number of instalments is 5 × 12 = 60. Applying the formula, the monthly payment works out at about €304. In total you will pay 304 × 60 ≈ €18,250, of which €15,000 is principal and roughly €3,250 is interest. That interest surcharge is what you should really compare between offers.

Payment and interest by term (€15,000 at 8% nominal)

Term	Monthly payment	Total interest
2 years	678 €	1.282 €
3 years	470 €	1.920 €
4 years	366 €	2.578 €
5 years	304 €	3.252 €
7 years	234 €	4.639 €
10 years	182 €	6.840 €

How to interpret the result

Look at two figures, not just the payment. The monthly payment tells you whether the loan fits your budget: as a reference, your total debt payments should not exceed 35% of your net monthly income. The total interest tells you what the borrowed money actually costs you and is the key number for comparing offers. Bear in mind this calculator works with the nominal rate: if the loan carries an arrangement fee or linked insurance, the real cost will be higher and you should look at the APR the lender is legally required to disclose.

Frequently asked questions

The nominal interest rate (TIN) is the pure interest the bank charges on the borrowed capital, excluding fees and additional costs. The Annual Percentage Rate (APR or TAE) is the more complete indicator: it incorporates the nominal rate plus all associated charges (arrangement fees, processing fees, linked insurance, etc.) and is expressed on an annual basis. When comparing loans from different lenders, always look at the APR rather than the nominal rate, since a loan with a low nominal rate can end up more expensive if it carries many fees. This calculator uses the nominal rate to compute the monthly payment.

This calculator uses the French amortisation system, the most common method for consumer loans in Spain. The formula is: payment = C · i / (1 − (1+i)^−n), where C is the loan principal, i is the monthly interest rate (annual rate divided by 12) and n is the total number of instalments (years × 12). With this system, the monthly payment is constant throughout the loan, but the split between principal and interest changes over time: in the early months you pay mostly interest and little principal, while towards the end the opposite is true.

If you miss a payment, the bank will charge default interest (which in Spain cannot exceed 2.5 times the legal interest rate, under the Consumer Credit Act). If missed payments continue for several months, the lender may accelerate the loan and demand the full outstanding balance immediately. Your details may also be listed in credit blacklists such as ASNEF, making it harder to obtain financing in the future. If you foresee payment difficulties, contact the bank before missing a payment — many lenders offer payment holidays or refinancing options.

Extending the term lowers the monthly payment but makes the loan considerably more expensive, because you pay interest for longer. For example, €15,000 at 8% over 5 years costs around €3,250 in interest; the same loan over 10 years exceeds €6,800 — more than double — even though the payment falls from about €304 to about €182. The practical rule is to choose the shortest term your monthly budget can comfortably absorb, leaving room for the unexpected. Extending the term only makes sense if the shorter payment would strain your ability to pay.

Yes. Spanish consumer credit law grants the right to repay in full or in part at any time. The lender may charge a compensation capped by law: a maximum of 1% of the amount repaid early if more than a year remains on the loan, or 0.5% if less. Early repayment always saves interest, and you can choose between reducing the payment (same term, less per month) or reducing the term (same payment, you finish sooner). Reducing the term saves more interest overall.