Interest Only Loan Calculator
Compare the two phases of an interest-only loan side by side. See the lower markup-only payment first, then the higher payment once principal kicks in - with total interest shown, so the payment shock never catches you off guard.
How to use
- Enter the loan amount and annual rate.
- Enter the interest-only period and the total term in years.
- Compare the monthly payment of both phases — the second phase payment is always higher because the principal is also included.
- Look at the total interest and plan your cash flow around it.
Tips
- The second-phase payment is always higher - budget for it from day one, not when it starts.
- During the interest-only phase the principal never shrinks, so you build no equity by paying.
- Compare total interest across different loan terms; a longer term can cost far more overall.
- If your income is seasonal, plan a savings buffer before the principal phase begins.
Note
In the interest-only phase the principal does not reduce at all, so the later payment jumps up suddenly. Prepare for that payment shock in advance.
Frequently Asked Questions (FAQ)
What does the interest only loan calculator show?
It shows the markup-only payment during the interest-only period and the new payment once principal repayment starts.
Can I compare both phases?
Yes, both payment phases are shown together for easy comparison.
What inputs does the loan calculator need?
Loan amount in rupees, the annual rate, the interest-only period in years and the total loan term in years.
Why is the second-phase payment higher?
After the interest-only period ends, each payment also includes part of the principal, so the monthly amount is always higher.