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Line of Credit Calculator
See how long it takes to clear a line of credit. Enter your drawn balance, the interest rate and the fixed payment you plan to make, then press Calculate to get your payoff time and total interest.
Written by TopicDrill Editorial Team·Updated June 2026
Balance over time
Balance
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How the line of credit calculator works
The tool simulates your line month by month. It starts with the balance you have drawn, charges one month of interest at the annual rate divided by twelve, and subtracts your fixed payment. Whatever the payment covers beyond the interest reduces the principal, and the cycle repeats until the balance reaches zero.
Because the interest is recalculated on a shrinking balance, your early payments are mostly interest while later ones are mostly principal. The balance chart makes that curve visible, dropping slowly at first and then faster as the principal melts away.
A worked example
Imagine you owe 25,000 dollars on a line at 9.5 percent and pay 600 dollars a month. The first month of interest is about 198 dollars, so roughly 402 dollars goes to principal. Holding that 600 dollar payment steady, the balance clears in a little under four and a half years, with several thousand dollars of total interest along the way.
Things to keep in mind
Many lines of credit carry variable rates, so a rate change will move your real payoff date away from this estimate. Treat the result as a snapshot at today's rate and rerun it whenever the rate shifts. For background on how these accounts work, the CFPB guide to lines of credit is a neutral starting point. If you instead have a fixed installment loan, our loan calculator is a better fit.
Frequently asked questions
How does a line of credit differ from a regular loan?
A line of credit is revolving, so you draw what you need up to a limit and interest accrues only on the balance you owe. A term loan hands you a fixed lump sum and a set payment. This tool models the payoff of whatever balance you currently have drawn against the line.
How is the interest on a line of credit calculated?
Interest is charged on the outstanding balance, usually monthly. Each month the balance is multiplied by the annual rate divided by twelve. Your payment first covers that interest, and whatever is left over reduces the principal, so the interest portion shrinks as the balance falls.
Why does the calculator say my payment is too low?
If your fixed monthly payment is not larger than the first month of interest, none of it reaches the principal and the balance never falls. The tool flags this and shows the first month interest so you know the floor your payment must clear to make real progress.
Will paying more each month save me money?
Yes, and often a lot. Because interest is charged on the remaining balance, a higher payment clears the principal faster, which means fewer months of interest. Even a modest increase above the minimum can cut both the payoff time and the total interest noticeably.
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