Student loans, some business loans and buy-now-pay-later offers allow deferment. Unless the deferral is interest-free, interest keeps growing – and if it is capitalized you then pay interest on interest.
How to use the Deferred Payment Loan Calculator
- Loan amount
- Interest rate
- Compounding frequency
- Deferral period
- Interest during deferral
- Repayment term after deferral
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the loan amount, rate, compounding, deferral period, how interest is treated during the deferral and the repayment term afterwards.
Tips
- Compare loans by APR and total cost, not just the monthly payment.
- Extra payments go straight to principal and can save a lot of interest.
- Pay off the highest-rate debt first if you want to save the most money.
- Check for prepayment penalties before paying a loan off early.
Common mistakes to avoid
- Stretching a loan term to lower the payment without seeing the extra interest.
- Paying only the minimum on credit cards.
- Forgetting fees that are rolled into the loan.
Inputs explained
| Field | What to enter |
|---|---|
| Loan amount | Amount in your currency |
| Interest rate | In % |
| Compounding frequency | Choose one: Yearly, Semi-annually, Quarterly, Monthly … |
| Deferral period | In months |
| Interest during deferral | Choose one: Accrues and is capitalized, Paid monthly, Interest-free (subsidized) |
| Repayment term after deferral | Units: years, months |
What each result means
- Monthly payment after the deferral = pmt([Monthly rate], [Repayment term after deferral], [Balance when repayment starts])
- Total interest = [Monthly payment after the deferral]×[Repayment term after deferral] – [Balance when repayment starts] + [Interest during the deferral]
- Total paid = [Monthly payment after the deferral]×[Repayment term after deferral] + [Monthly interest payment during the deferral]×[Deferral period]
Example values
How the main result changes when Loan amount changes and everything else stays at the example values above:
| Loan amount | Monthly payment after the deferral |
|---|---|
| 15,000 | 193.9 |
| 22,500 | 290.85 |
| 30,000 | 387.8 |
| 37,500 | 484.75 |
| 45,000 | 581.7 |
| 60,000 | 775.6 |
Formula
Accrued interest = L × ((1 + i)^deferral months − 1) (compounding) or L × r × months ÷ 12 (simple)Capitalized: repayment balance = L + accrued interest; interest paid monthly: balance stays L; interest-free: balance stays LPayment = pmt(i, repayment months, balance)Worked example
Inputs — Loan amount: $30,000; Interest rate: 6.5 %; Compounding frequency: Monthly; Deferral period: 24 months; Interest during deferral: Accrues and is capitalized; Repayment term after deferral: 10 years.
Results — Interest during the deferral = $4,152.87; Monthly interest payment during the deferral = $0.00; Balance when repayment starts = $34,152.87; Monthly payment after the deferral = $387.80; Total interest = $16,535.87; Total paid = $46,535.87.
Frequently asked questions
What is a deferred payment loan?
A loan whose payments start after an initial period.
Does interest accrue during deferment?
Usually yes, except on subsidized or interest-free deferrals.
What does capitalized interest mean?
Unpaid interest added to the principal, so you pay interest on it later.
What formula does the Deferred Payment Loan Calculator use?
Accrued interest = L × ((1 + i)^deferral months − 1) (compounding) or L × r × months ÷ 12 (simple).