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Result

The formula

Standard amortizing loan payment formula.

M = P × [r(1+r)^n] / [(1+r)^n − 1]

Worked example

  1. P = $20,000, r = 6%/12, n = 60
  2. Monthly payment ≈ $386.66

Result: Payment: $386.66/mo

Interesting facts

Amortization

Early payments are mostly interest; later payments pay down more principal.

Frequently asked questions

Principal, interest rate, and loan term length.

Estimates only — not financial advice.

Last reviewed: 2026-07-01 — Reviewed by: Editorial Team

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