Our Methodology

Every calculator on PayoffRoute is built on standard, published financial mathematics — the same formulas lenders and finance textbooks use. This page documents exactly how we compute results, what our models assume, and how we verify them, so you never have to take our numbers on faith. Last reviewed: July 8, 2026.

The core formula: loan amortization

Fixed-payment loans (home equity loans, personal loans, mortgages, and HELOC repayment phases) use the standard amortization payment formula:

M = P × r ÷ (1 − (1 + r)−n)

When the rate is 0%, the formula reduces to simple division: M = P ÷ n. Total interest is always M × n − P. This is the same equation documented in any finance reference — see, for example, the CFPB's consumer tools or any standard text on the time value of money. Where our articles cite market figures (average card APRs, national debt balances), they come from primary sources — the Federal Reserve's G.19 consumer credit release and the New York Fed's Household Debt and Credit Report — and are dated in the text.

Month-by-month simulation

Scenarios that a closed formula can't capture — extra payments, multiple credit cards, promotional rate windows, payoff-strategy comparisons — are computed by direct simulation. Each simulated month:

  1. Interest accrues on the outstanding balance: balance × (annual rate ÷ 12)
  2. The month's payment is applied (never more than the remaining balance)
  3. The balance carries into the next month

The loop runs until the balance reaches zero or 1,200 months (100 years) pass — at which point we tell you plainly that the plan never pays off, rather than showing a misleading number. Multi-debt tools (credit card payoff, debt consolidation) simulate every debt in parallel: minimum payments go to each open account first, and the remaining budget goes to the target account chosen by your strategy. When an account closes, its freed-up payment automatically rolls into the attack budget.

How fees are counted

We count fees as part of the true cost of borrowing, not as a footnote. Origination fees and balance-transfer fees are added to the financed principal (or deducted from your disbursement, where that's how the product works), and every "total cost" figure we show includes them. The personal loan calculator goes further and reports an effective APR — the rate that equates what you actually received with what you actually repay — found by bisection search, because a fee deducted up front makes the true cost higher than the advertised rate.

What our models assume

How we verify

Every calculator is checked before release by recomputing its outputs independently — the amortization results against the closed-form formula, the simulations against hand-worked scenarios.

On top of that, an automated browser test suite (tests/edge-cases.mjs in our repository, run with npm test) drives all 42 calculators in a real browser through the regimes where financial models break: 0% rates, balances of zero, payments too small to cover the interest, and fee extremes — and it repeats every one of those through every mode each calculator offers, because the ugliest bugs hide behind a dropdown. Its rule is simple: a calculator may answer “Never” or “—”, but it may never print a nonsense number. A run that produces no output at all fails too, so the suite cannot pass by doing nothing.

When a calculator's inputs allow a situation its model can't answer honestly, it says so instead of guessing. That is a promise the tests enforce, not just a sentence on this page.

Found an error?

If any number on this site looks wrong, we want to know — tell us and include the inputs you used. Verified corrections ship quickly, and this page's review date is updated whenever formulas or content change.