How to calculate loan payments and costs

Multiply that figure by the initial balance of your loan, which should start at the full amount you borrowed. For the figures given, the loan payment formula would look like:Divide your interest by the number of payments you’ll make each year. Usually, the number is 12 — one payment per month.To calculate how many payments you’ll make in your loan term, multiply the number of years by 12. Let’s say you took out an auto loan for $20,000 with an APR of 6 percent and a five-year repayment timeline. Here’s how ...