Loan Interest Calculator (Equal Principal and Interest · Equal Principal)
Enter the loan amount, annual interest rate and term (in months) to see the monthly payment and total interest for equal principal and interest (원리금균등) and equal principal (원금균등) repayment side by side.
Show the calculation
The monthly rate r is the annual rate ÷ 12 ÷ 100. At 4.5% a year, r = 0.00375.
Equal principal and interest: monthly payment = principal × r × (1 + r)months ÷ ((1 + r)months − 1). Total interest = monthly payment × months − principal. At a 0% rate this formula cannot be calculated, so the principal is divided by the number of months and total interest is treated as 0 won.
Equal principal: the principal repaid each month is fixed at principal ÷ months, and that month's interest = remaining principal × r. In the first month interest applies to the whole principal, so first-month payment = principal ÷ months + principal × r. Because the remaining principal drops by one step each month, total interest works out to principal × r × (months + 1) ÷ 2.
Example: for KRW 100 million at 4.5% a year over 360 months, equal principal and interest is KRW 506,685 per month with total interest of KRW 82,406,712; equal principal is KRW 652,778 in the first month with total interest of KRW 67,687,500. The last monthly payment under equal principal falls to about KRW 278,819.
How to use
For the loan amount, enter the amount you actually borrow in won. Commas are removed automatically. For the annual interest rate, enter the yearly rate your bank quoted as a plain percentage number; for 4.5%, just write 4.5. The term must be in months, so enter 360 for a 30-year loan, 120 for 10 years and 36 for 3 years.
After you press Calculate, the equal principal and interest result appears on the left and the equal principal result on the right. It helps to look at the difference in total interest first, then check whether the first month's payment fits your current monthly income.
Basis of the calculation
The names of the repayment methods and the calculation structure follow the loan interest calculator of the Financial Supervisory Service's financial consumer information portal FINE (금융감독원 금융소비자 정보포털 파인), which offers bullet repayment at maturity, equal principal and interest installments, equal principal installments, and installments after a grace period. FINE also drops amounts below one won and notes that actual bank calculations can differ slightly because the number of days varies by month. This calculator computes each month's interest as the annual rate ÷ 12 and rounds to the nearest won.
The prepayment fee rules were checked in a press release of the Financial Services Commission (금융위원회) and Article 20 of the Financial Consumer Protection Act (금융소비자 보호에 관한 법률). Sources checked: Financial Supervisory Service (FINE), Financial Services Commission, Korea Law Information Center (국가법령정보센터). Checked on: 2026-10-13.
Equal principal and interest vs. equal principal: what is the difference?
With equal principal and interest, the combined amount of principal and interest is the same from start to finish. The money leaving your account each month is constant, which makes budgeting easy. In return, most of what you pay early on goes to interest and the principal shrinks slowly. Because a large balance remains for a long time, more interest accrues.
With equal principal, the principal repaid each month is the same, and interest applies only to the remaining principal. The burden is therefore heaviest in the first month and gets lighter over time. Since the principal falls faster, total interest is lower than with equal principal and interest. The FINE guidance also explains that, at the same rate, total interest is lower with equal principal.
As in the example above, borrowing KRW 100 million for 30 years at 4.5% a year gives a difference in total interest of about KRW 14.72 million between the two methods. Looking only at the first month, however, equal principal costs about KRW 146,000 more. The shorter the term, the smaller this gap. For KRW 30 million at 5% over 36 months, total interest is KRW 2,368,569 with equal principal and interest and KRW 2,312,500 with equal principal, a difference of about KRW 56,000.
Which method should you choose?
If your income has room now and is not expected to rise much, equal principal saves interest. If you can get through the first few years, the payment keeps falling and the burden eases. On the other hand, if your income is tight now but likely to grow, as for someone early in their career, equal principal and interest with its smaller first-month payment is more realistic. The same amount every month is also easy to manage with automatic transfer.
Before choosing, it helps to work out what percentage of your monthly take-home pay the first payment would be. Check that you still have money left after living costs and an emergency fund, and if the loan has a floating rate that may rise, try entering a rate 1 to 2 percentage points higher as well. Some products at some banks only allow certain repayment methods, so ask about this when you consult the bank.
Common mistakes and cautions
- A grace period is not included. If there is a grace period in which you pay interest only for the first few years, the principal does not shrink during that time and total interest will be higher than calculated here. For loans with a grace period, check separately using the "installments after a grace period" option of the FINE loan interest calculator.
- Prepayment fees are also left out. Under the Financial Consumer Protection Act, prepayment fees are prohibited in principle and may be charged as an exception only when you repay within 3 years of the loan date. The Financial Services Commission has required that, for contracts newly made on or after January 13, 2025, fees may only be charged within the actual cost incurred. If you plan to repay early, be sure to check the fee rate in the product description.
- If you enter a monthly rate in the annual rate field, the result will be off by about a factor of twelve. Enter the "annual ○%" figure from the bank's notice as it is.
- For floating-rate loans, the payment changes when the rate changes. This calculation assumes the rate you entered stays the same until the end.
- Incidental costs such as guarantee fees, stamp duty and mortgage registration costs are not included.
Frequently asked questions
Equal principal costs less interest, so why do many people choose equal principal and interest?
Because of the first month's burden. Equal principal has larger early payments, which are hard to carry if income is tight. Equal principal and interest costs a little more in interest, but the same amount every month makes planning easier.
Can I enter the term in years instead of months?
No. This calculator works in months, so multiply by 12: enter 360 for 30 years. If you enter 30, it is calculated as 30 months.
The amount differs by a few won from what I saw in my bank app.
Banks often calculate interest daily using the actual number of days or drop amounts below one won. The FINE calculator of the Financial Supervisory Service also notes that small differences can occur for the same reason. A difference of a few won to a few hundred won comes from these calculation methods.
What happens if I enter a 0% rate?
It is treated as an interest-free loan and the principal is divided equally by the number of months. Total interest comes out as 0 won for both methods.
Why is there no bullet repayment at maturity (만기일시상환)?
With bullet repayment at maturity, you pay only interest each month (principal × annual rate ÷ 12) and repay the whole principal when the loan ends, so the calculation is simple. As FINE explains, the monthly burden is the smallest but total interest is the highest and you need a lump sum at maturity.
This is a reference calculation; official guidance from the relevant institution takes precedence.
Tools that work well together
- Deposit and Savings Interest Calculator — compare how much interest you would earn if you saved up instead of borrowing.
- Pyeong Calculator — convert between ㎡ and pyeong right away when looking for a home.