Identify the principal amount borrowed
Identify the interest rate
Identify the time period the loan is outstanding
Convert the interest rate to a decimal
Convert the time period to years if needed
Use the simple interest formula: Interest = Principal × Rate × Time
Use the amortized loan formula if the loan has regular payments
Calculate monthly interest by dividing the annual rate by 12
Multiply the remaining balance by the monthly interest rate
Subtract any payments made from the balance
Repeat the calculation for each payment period if needed
Add all interest amounts to find total interest paid