Philippines Loan Calculator (2026)
Compute your monthly loan amortization, total interest paid, and view the complete payment schedule for personal loans, home loans, and auto loans.
How Loan Interest Works in the Philippines
Philippine banks use the diminishing balance (reducing balance) method for computing loan interest. Each monthly payment covers both interest and principal. Early in the loan, most of your payment goes to interest; as time passes, more goes to principal.
The amortization formula ensures your monthly payment stays constant while the interest portion decreases and the principal portion increases each month.
Tip: A lower interest rate and shorter term save the most money. Use the amortization schedule to see exactly how much interest you pay each month.
Related Resources
Loan Calculator FAQs
How is monthly loan payment computed?
The standard amortization formula is: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the principal loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the number of months. This ensures equal monthly payments throughout the loan term.
What is a good interest rate for personal loans in the Philippines?
As of 2026, competitive personal loan rates in the Philippines range from 1.2% to 1.8% per month (14.4% to 21.6% per year) from banks like BDO, BPI, and Metrobank. Government loans (SSS, Pag-IBIG) offer much lower rates of 5.95% to 10% per year.
What is the difference between add-on rate and diminishing balance rate?
An add-on rate charges interest on the full original principal throughout the loan. A diminishing balance (reducing balance) rate charges interest only on the remaining balance — this is the standard amortization method used in this calculator. A 1% add-on rate is roughly equivalent to a 1.8% diminishing balance rate.
How long does it take to get a personal loan approved in the Philippines?
Bank approval typically takes 3–7 business days with complete documents. Online lenders and fintech apps (Tonik, CIMB, Maya) can approve in as fast as 24 hours. Government loans (SSS, Pag-IBIG) may take 1–2 weeks.
Can I prepay my loan early?
Most Philippine banks allow early loan settlement, but may charge a prepayment penalty of 2–5% of the outstanding balance. Some lenders waive this fee after a certain period. Always check your loan agreement's prepayment terms.