Compare methods with identical assumptions
This fictional example uses KRW 100,000,000 at a nominal annual rate of 4.5%, held constant for 360 monthly payments made at month-end. There is no grace period, early repayment, delinquency, or fee. A 30-year bullet loan is a comparison assumption, not a claim that such a product is available.
Select KRW, enter principal 100000000, annual rate 4.5, and term 360 months. Change only the repayment method. Currency selection changes the unit, not the exchange rate. The monthly rate is 0.045 ÷ 12 = 0.00375, or 0.375%.
- P = principal of KRW 100,000,000
- r = monthly rate of 0.00375
- n = 360 payments
- Check the lender's applicable rate, dates, and terms separately
Use the fixed-payment amortization formula
A is each month's combined principal and interest payment. The formula below assumes a constant rate and payments at the end of each month, with no early repayment. The ^ symbol denotes a power; substitute 0.00375 for r, not 4.5.
Monthly interest equals the balance before payment × r. Principal repaid equals A minus that interest. Subtract principal repaid from the balance for the next month. The payment is level while its interest component declines. A lender may adjust the last payment for currency rounding.
A = P × r ÷ [1 − (1 + r)^(−n)]
= 100,000,000 × 0.00375 ÷ [1 − (1.00375)^(−360)]
≈ KRW 506,685.30982588
Excel check: =-PMT(4.5%/12,360,100000000,0,0)Handle zero interest separately
When r = 0, the formula's denominator is also zero. Use A = P ÷ n instead. Fixed-payment and equal-principal loans have no interest and divide principal across the term. KRW 120,000 over 12 months therefore costs KRW 10,000 per month.
For a zero-rate bullet loan, payments before maturity are zero and the full KRW 120,000 principal is due in the final month. Equal interest totals do not imply equal payment timing.
Reproduce the KRW 100 million comparison
Using the same inputs in each mode produces the figures below. The fixed-payment loan's first-month interest is 100,000,000 × 0.00375 = KRW 375,000 and principal repayment is about KRW 131,685. Equal-principal repayment adds interest on the outstanding balance to about KRW 277,778 of monthly principal.
The calculation keeps intermediate precision, then rounds displayed results to the nearest won. Multiplying the displayed monthly amount of KRW 506,685 by 360 will therefore not reproduce the precision-based total. Use the unrounded amount to check total interest.
| Method | First payment | Final payment | Total interest | Total paid |
|---|---|---|---|---|
| Fixed payment | KRW 506,685 | KRW 506,685 | KRW 82,406,712 | KRW 182,406,712 |
| Equal principal | KRW 652,778 | KRW 278,819 | KRW 67,687,500 | KRW 167,687,500 |
| Bullet | KRW 375,000 | KRW 100,375,000 | KRW 135,000,000 | KRW 235,000,000 |
Check equal-principal and bullet interest
The equal-principal payment in month k is P ÷ n + [P − (k − 1) × P ÷ n] × r. Because balance decreases in equal steps, total interest is P × r × (n + 1) ÷ 2. Here that is 100,000,000 × 0.00375 × 361 ÷ 2 = KRW 67,687,500.
A bullet loan leaves all principal outstanding until maturity. Monthly interest is P × r = KRW 375,000 and total interest is P × r × n = KRW 135,000,000. The final payment combines interest and principal: KRW 100,375,000.
With identical principal, positive fixed rate, and term, and no grace period or early repayment, equal-principal repayment has lower total interest than fixed-payment amortization. It saves about KRW 14,719,212 in this example, but requires about KRW 146,092 more in the first month. Consider that initial cash-flow requirement too.
Separate a verified estimate from a lender's bill
On October 2, 2026, the example was independently checked using the formula and a monthly balance schedule, then compared with Baro Tool's calculation. The unrounded fixed payment is approximately KRW 506,685.30982588 and total interest is KRW 82,406,711.537317. The zero-rate example was checked separately.
Real products can use actual-day interest, lender-specific rounding, guarantee fees, taxes, early repayment charges, and discount conditions. KB Kookmin Bank's guidance distinguishes monthly calculations from actual-day calculations. Your contract and the lender's repayment schedule determine contractual amounts.
For a variable-rate loan, the calculator assumes the entered rate remains unchanged throughout the term. Repeating the calculation with different rates is a scenario comparison, not a forecast. Results do not determine loan approval, DSR eligibility, or a suitable product for an individual.