Figuring out accrued interest on a loan can be accomplished using a simple interest calculator tool. The total amount paid in interest charges over the life of the loan can also be figured using this helpful tool. A loan calculator will show what the monthly payments are on any loan amount at any interest rate. These simple calculations can be performed online using the tool provided by finance companies and banks.Calculate Interest ChargesA simple interest loan may have an annual percentage rate of 10 percent. This means that each year the borrower must pay 10 percent of the remaining loan amount, spread over 12 months. This is in addition to the amount paid on the principal balance. As the balance decreases so does the interest owed. However the total monthly payment remains the same. Amortization is the name of the process by which this is accomplished.If an individual borrows $10,000 at 10 percent interest and the loan term is for five years, the loan calculator or interest calculator tool will show exactly how much interest is paid each year. A simple interest loan with the figures mentioned above would accrue $1,000 in interest the first year. However a 5-year, $10,000 loan at 10 percent interest will result in a total of 60 equal payments of about $212. Multiplying this total by 12 results in a first year payment of $2,544. This means that the individual paid $1,544 toward the balance of the loan and $1,000 in interest charges.Figure Total Interest Paid At Any Given TimeA simple interest calculator will show how much interest has been collected by the lender after any number of monthly installments have been paid. The borrower merely enters the loan amount and interest rate. By choosing any number of made payments the actual interest charges collected is shown immediately.Help For Car BuyersThese loan estimators and interest calculator tools are useful for those looking at different car models and comparing offers made by various lenders. Some lenders will offer a slightly lower interest rate but only if the loan term is stretched. A 60-month auto loan will cost the buyer more in interest charges over the life of the loan than will a 48-month agreement with a slightly higher annual percentage rate. Those wanting to save over the entire loan period will be able to make an informed decision after using an interest calculator.