Rule-of-78s Loan Calculator

Rule-of-78s Amortization Schedule & Charts

The Rule-of-78s, also known as the Sum-of-the-Digits method, is a method used by lenders to calculate a loan's interest charges.

The result is that borrowers pay more interest in the early months of the loan term, and less interest in the later months. This can be disadvantageous for borrowers who wish to pay off the loan early, as they will pay a larger portion of the total interest charges earlier than if they had had a traditional loan.

The Rule-of-78s method is not commonly used today, as many countries have banned its use due to the potential for unfairness to borrowers. Most lenders now use the simple interest method or the daily interest method to calculate interest on loans.

Enter a "0" (zero) for one unknown value above.

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Additional instructions for the Rule-of-78s calculator

  • Loan Amount: Enter the total principal amount of the loan. This is the amount that you will be required to pay back, along with any interest charges, over the course of the loan term.
  • Number of Payments: Enter the number of payments that you will be required to make to pay the loan back in full. This must be expressed as the total number of periods depending on the payment frequency.
  • Annual Interest Rate: Enter the annual interest rate that will be charged on the loan.
  • Payment Amount: Enter the amount that you will be required to pay on each payment due date. This can be calculated based on the loan amount, the number of payments, and the interest rate.

Above are the "primary user inputs." Any one may be set to "0" and the calculator will calculate the value.

  • Payment Frequency: Enter the frequency at which payments will be due. This can be expressed as monthly, quarterly, semi-annually, annually, etc., depending on the terms of the loan.
  • Compounding: Enter the frequency at which interest will be compounded. If you are not sure what the compounding frequency is, then set it to equal the payment frequency. Compounding is the process of adding the interest that has been earned to the principal balance of the loan, so that interest charges can be calculated on the new, higher balance.
  • Payment Method: Loans are paid-in-arrears. That is, the first payment is due one payment frequency after the loan originates. Leases, on the other hand, are paid-in-advance. That is, the first lease payment is made on the day the lease is signed.

Above are the "secondary user inputs." They must all be set. In the event you are not sure, however, you may leave them set to their default values.

Related: These calculators also support rule-of 78s loans and they are more feature rich as well. For example, with many you can set the dates and/or add extra payments.

If you try one of the above, just set the "Amortization Method" to "Rule-of-78s."

4 Comments on “Rule Of 78s Loan Calculator”

Join the conversation. Tell me what you think.
  • Thank you So Much for this Calculator!!!

    I have taken a Rule of 78s loan and afterwards I used this calculator to print and show the lender what they were doing to me with the interest. I was able to take advantage of the 7 Day return window with OneMain Financial and saved almost $10,000 in Interest by returning their money and NOT Taking their precomputed interest loan.

    This Calculator is the best I’ve found online. And the print function of the Payment Schedule and Loan Summary is amazing.

    Thank you so much for this. Really appreciate it! 🙂


  • A useful feature to consider for your calculator would be an optional field to specify an Additional monthly payment. I’m comparing two different insurance financing proposals, one is a monthly payment and the other is quarterly, I was trying to find out if we pay an extra 200% or 300% each month how much we’d be saving on the finance charge. Thanks for the tool though, one of the best I’ve found online.

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