Signature Loan Calculator

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Reviewed by: David Chen, CFA
David is a Chartered Financial Analyst with 15 years of experience in consumer lending and unsecured credit markets.

This 4-in-1 Signature Loan calculator helps you estimate payments for unsecured personal loans. Enter any three variables—Loan Amount, Annual Rate, Loan Term, or Monthly Payment—to solve for the fourth.

Loan Amount ($) (P)

Annual Rate (%) (R)

Loan Term (Years) (T)

Monthly Payment ($) (M)

Signature Loan Formulas (Amortization)

Solve for Monthly Payment (M):
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]

Solve for Loan Amount (P):
P = M [ (1 + i)^n – 1 ] / [ i(1 + i)^n ]

Solve for Loan Term (n, in months):
n = -ln(1 – (P*i / M)) / ln(1 + i)

Solve for Rate (i):
*Solved iteratively (no direct formula)

Formula Source: Investopedia

Formula Variables

(P) Loan Amount (Principal): The total amount of money you are borrowing.
(R) Annual Rate: The annual interest rate (APR) for the loan.
(T) Loan Term (Years): The total length of time you have to repay the loan.
(M) Monthly Payment: The fixed payment amount due each month.
(i): Monthly Interest Rate (R / 12 / 100)
(n): Total Number of Payments (T * 12)

Related Calculators

What is a Signature Loan?

A “signature loan” is another name for an unsecured personal loan. It gets its name from the fact that the only thing backing the loan—the only collateral—is your signature on the loan agreement. The lender gives you the money based solely on your creditworthiness, income, and promise to repay.

Because there is no asset (like a car or a house) for the lender to seize if you default, signature loans are riskier for lenders. This typically results in higher interest rates compared to secured loans like mortgages or auto loans. However, they are very flexible and can be used for any purpose, such as consolidating debt, paying for a vacation, or handling an emergency expense.

This calculator functions as a standard installment loan calculator, allowing you to model the relationship between the loan amount, interest rate, term, and monthly payment for any signature loan.

How to Calculate a Signature Loan Payment (Example)

Identify Your Loan Details
You’re approved for an $8,000 (P) signature loan. The term is 3 years (T) and the annual rate is 14.5% (R). You need to find your monthly payment (M).
Find Monthly Rate (i) and Total Payments (n)
Monthly Rate (i) = 14.5% / 12 / 100 = 0.0120833
Total Payments (n) = 3 Years * 12 Months = 36
Apply the Amortization Formula
The formula is: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ]
Calculate the Payment
M = $8,000 [ 0.0120833 * (1.0120833)^36 ] / [ (1.0120833)^36 – 1 ]
M = $8,000 [ 0.0120833 * 1.5405 ] / [ 1.5405 – 1 ]
M = $8,000 [ 0.018615 ] / [ 0.5405 ]
M = $8,000 * 0.03444
Final Result
Your fixed monthly payment (M) will be $275.52 for the next 3 years.

Frequently Asked Questions (FAQ)

Is a signature loan the same as a personal loan?

Yes, for the most part. “Signature loan” is a slightly older term that specifically highlights the unsecured nature of the loan (i.e., it’s backed only by your signature). Today, it’s most commonly just called an unsecured personal loan.

What credit score do I need for a signature loan?

Because these loans are unsecured, lenders rely heavily on your credit score. You will typically need a FICO score of 660 or higher to qualify for a good rate, though some lenders specialize in loans for fair or poor credit (often at much higher interest rates).

How do I find the Annual Rate (R)?

You can use this calculator if you have a loan offer. Enter the Loan Amount (P), the Loan Term (T), and the offered Monthly Payment (M). Leave the “Annual Rate (R)” field blank and click “Calculate.” The result will show you the exact APR of the loan offer, allowing you to compare it with others.

Are signature loans better than credit cards for debt consolidation?

Often, yes. Signature loans typically have lower fixed interest rates than credit cards, which have high variable rates. Consolidating high-interest credit card debt into a single installment loan with a lower rate and a fixed payoff date can save you significant money on interest and help you get out of debt faster.

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