$250k loan, 6% APR, 60 months
- Monthly interest ≈ $1,250
- Five-year interest ≈ $75,000
- Total due (interest + principal) ≈ $325,000
finance calculator
Interest-Only Loan Calculator
See monthly interest payments and total costs before principal comes due.
Results
- Monthly interest payment
- $1,250 USD
- Total interest during period
- $75,000 USD
- Interest + principal due
- $325,000 USD
How to use this calculator
- Enter the loan amount, APR, and how many months are interest-only.
- We calculate the monthly interest payment and total interest for that period.
- See the principal that remains plus total cash outlay once the period ends.
Inputs explained
- Loan amount
- Principal borrowed. Interest accrues on this full amount.
- Interest rate (APR)
- Annual percentage rate expressed as a percent.
- Interest-only period
- Number of months you will only pay interest before principal is due.
How it works
We multiply principal by the monthly interest rate (APR ÷ 12) to find the monthly payment.
Total interest = monthly payment × number of months. The principal still needs to be repaid at term end.
Formula
Monthly interest = Principal × (APR ÷ 12) Total interest = Monthly × Months
When to use it
- Comparing bridge loan options while a property is being sold.
- Projecting cash flow on interest-only construction loans.
- Understanding how much interest accumulates before refinancing into a fully amortizing loan.
Tips & cautions
- Plan early for the principal payoff or refinance—payments can jump sharply after interest-only periods.
- Account for taxes, insurance, and HOA separately since this calculator focuses on principal and interest.
- If rates may reset, rerun scenarios with higher APRs to see stress cases.
- Assumes a fixed rate and simple interest on the full principal during the period.
- Does not include origination fees, points, or escrow items.
- Does not model partial principal prepayments during the interest-only window.
Worked examples
$500k bridge loan, 8% APR, 12 months
- Monthly ≈ $3,333
- Interest year ≈ $40,000
Deep dive
Model interest-only loans by entering loan amount, APR, and period length to see monthly interest and total costs.
Use it to prep for balloon payoffs, refinancing decisions, and cash flow planning before principal payments begin.
FAQs
- Does this include escrow or fees?
- No. It only models the loan’s interest cost. Add taxes/insurance separately if needed.
- What happens after the interest-only period?
- You typically refinance or start amortizing the principal. Consult your lender for the exact structure.
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Numbers are estimates. Review real loan disclosures before deciding on any financing product.