Loan/Mortgage Calculator

Enter the loan amount, annual interest rate, and loan term to calculate monthly payments, total interest paid, and total cost of the loan. View a detailed amortization schedule showing how each payment splits between principal and interest.

Compare different loan scenarios side by side. Works for mortgages, car loans, personal loans, and any fixed-rate amortizing loan.

**Understanding Loan Payments**

Every loan payment consists of two parts: principal (the amount you borrowed) and interest (the cost of borrowing). In the early years of a loan, most of your payment goes toward interest. As the principal balance decreases over time, more of each payment goes toward principal. This is called amortization, and the tool shows this progression in a detailed schedule.

The standard amortization formula calculates your fixed monthly payment: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the loan principal, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payments (loan term in years × 12). This formula ensures every payment is the same amount, with the principal-to-interest ratio shifting over time.

**South African Lending Context**

South African home loan (bond) interest rates are typically linked to the prime lending rate set by the South African Reserve Bank. As of 2026, the prime rate is approximately 11.75%, though individual rates vary based on your credit score, deposit size, and the lender. First-time home buyers with good credit may qualify for rates below prime, while riskier borrowers may pay prime plus 1–3%.

For vehicle finance, South African rates typically range from 8–15% depending on whether the car is new or used, the term length, and your credit profile. Balloon payment options lower monthly instalments but increase the total cost of the loan significantly.

Personal loans in South Africa can carry interest rates of 15–28% per annum, regulated by the National Credit Act which sets maximum interest rate caps based on the repo rate. Short-term credit and payday loans can be even more expensive.

**Real-World Scenarios**

A first-time buyer in Johannesburg purchases a home for R1,200,000 with a R120,000 deposit (10%), financing R1,080,000 at 11.5% over 20 years. The monthly payment is R11,521, with total interest of R1,685,040 over the life of the loan — meaning the total cost is R2,765,040, more than double the purchase price.

A Durban resident finances a R350,000 car at 9% over 5 years with a R35,000 deposit. The monthly payment is R6,228, with total interest of R60,693. Adding a R70,000 balloon payment would reduce the monthly payment to approximately R5,300 but increase total interest paid.

A small business owner takes a R200,000 personal loan at 18% over 3 years to fund equipment. Monthly payments are R7,234, with total interest of R60,424.

**Tips for Managing Loans**

Pay extra when you can — even small additional amounts toward principal dramatically reduce total interest and shorten the loan term. On a R1 million bond at 11.5%, paying an extra R1,000/month saves approximately R370,000 in interest and cuts 4 years off a 20-year term. Shop around for the best rate — even a 0.5% difference on a large loan saves tens of thousands over the term. Avoid balloon payments unless absolutely necessary, as they defer rather than reduce costs. Consider shorter loan terms if you can afford higher monthly payments — a 15-year bond costs more per month but saves hundreds of thousands in interest compared to a 20-year term.