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Equal Installment:
• Pay the same amount (principal + interest) every month
• Higher interest proportion initially, increasing principal proportion over time
• Easy to plan repayment schedule
🏦 Loan Interest & Repayment Calculator
When taking out a loan, the most important thing is to choose the repayment method that suits you. This calculator helps you make an informed decision by accurately calculating the monthly repayment amount and total interest for both equal installment and equal principal methods.
Monthly Payment (Fixed)
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Total Repayment
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Total Interest
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Principal
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Loan Period
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Loan Repayment Method Comparison
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Equal Principal:
• Pay the same principal amount every month with separately calculated interest
• Higher initial payments that gradually decrease
• Lower total interest burden than equal installment
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Which Method to Choose?
• If you have initial capital capacity: Equal Principal (total interest savings)
• If you want stable repayment: Equal Installment (fixed repayment amount)
Learn more
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Benefits of Equal Principal Repayment Method
The equal principal repayment method involves paying the same principal amount each month, with interest calculated separately on the remaining balance. The biggest advantage of this method is that the total interest burden is less than the equal installment method. For example, when borrowing 300 million won at 4% for 30 years, repaying with the equal principal method results in total interest of about 180 million won, compared to about 210 million won with equal installment method, saving approximately 30 million won. Initial repayment amounts are higher (about 1.83 million won in the first month) but gradually decrease, reaching about 840,000 won in the last month. This method is suitable for those with initial capital capacity who want to reduce long-term interest burden.
Frequently asked questions
Which is better, equal installment or equal principal?
In terms of total interest alone, equal principal is more favorable (higher initial payments but less interest overall). If you prefer a stable, fixed monthly payment for easier budgeting, equal installment is simpler to plan around. Choose equal principal if you have capital upfront, or equal installment if you prefer fixed expenses.
What exactly does this calculator compute from my loan amount, rate, and term?
It computes the fixed monthly payment and total interest under the equal installment method, plus the first- and last-month payments and total interest under the equal principal method, so you can compare both side by side.
Does this calculator account for early repayment fees?
No. It only provides pure principal-and-interest calculations based on the rate and term you enter. Early repayment fees, preferential rate conditions, and other bank-specific terms vary and should be checked separately.
How is the annual interest rate converted to a monthly rate?
The annual rate is divided by 12 to get the monthly rate, which is then applied to the remaining principal each month. For example, a 4% annual rate works out to roughly a 0.333% monthly rate.
How much interest difference is there between the two methods for a 300 million KRW, 30-year loan?
At 4% annual interest, equal installment totals about 210 million KRW in interest versus about 180 million KRW for equal principal — a difference of roughly 30 million KRW. The gap widens further with longer loan terms.