Loan Calculator UK

Use the loan calculator above

Type in three things and the loan calculator does the rest: how much you want to borrow, the APR (annual percentage rate) the lender is quoting, and how long you want to repay over. It returns your monthly payment, the total amount repaid over the full term, and the total interest you will pay on top of the amount borrowed. Adjust any input to see deals side by side before you commit.

How a finance calculator works out your repayments

Most UK loans use a method called amortisation. You make the same fixed payment every month, and each payment is split between interest (the lender's charge) and capital (chipping away at what you owe). Early on, more of your payment goes on interest because the balance is large. As the balance shrinks, more of each payment clears the capital, until the final payment takes it to zero.

The monthly payment is worked out with a standard formula. In plain words: your monthly payment equals the amount borrowed, multiplied by the monthly interest rate, multiplied by a compounding factor, divided by that same factor minus one. Written more simply:

• Monthly rate = APR divided by 12.
• Number of payments = years multiplied by 12.
• Monthly payment = (loan amount × monthly rate × (1 + monthly rate) raised to the number of payments) ÷ ((1 + monthly rate) raised to the number of payments, minus 1).

You do not need to do this by hand because the finance calculator above handles it instantly, but seeing the method tells you why two loans of the same size can cost wildly different amounts. The APR and the term are the two levers that move the total, and small changes to either ripple through every payment. If you want to test how interest builds over time more generally, the compound interest calculator shows the same maths working in your favour on savings rather than against you on debt.

Worked example one: a £5,000 personal loan over 3 years

Say you borrow £5,000 to spread the cost of a home repair and the lender quotes a representative APR of 9.9% over 36 months. The monthly rate is 9.9% ÷ 12, which is about 0.825%. Putting that through the amortisation formula gives:

• Monthly payment: about £161
• Total repaid over 3 years: about £5,800
• Total interest: about £800

So the £5,000 you borrow costs roughly £800 to use over three years. These figures are illustrative, picked to show the method. Your own APR depends on your credit profile and the lender, so put your real numbers into the calculator above for an exact result. A tool like the personal loan calculator lets you model the same loan at different rates in seconds.

Worked example two: a £10,000 loan over 5 years

Now take a bigger borrow. You want £10,000 to consolidate several debts into one payment, and a lender offers 7.5% APR over 60 months. The monthly rate is 7.5% ÷ 12, about 0.625%. The amortisation maths gives:

• Monthly payment: about £200
• Total repaid over 5 years: about £12,023
• Total interest: about £2,023

The lower rate keeps the cost per pound down compared with example one, but the larger sum and longer term still add more than £2,000 in interest. If you are weighing up rolling several balances into one, the debt consolidation calculator helps you check whether one loan really beats your current spread of payments.

APR versus flat rate: don't compare apples with oranges

APR is the figure that matters when you compare loans. It bundles the interest rate with most compulsory fees and expresses the yearly cost as a single percentage, so a 9.9% APR loan is genuinely cheaper than an 11.5% APR loan of the same size and term. UK lenders advertise a representative APR, which at least 51% of accepted applicants must receive, but your personal rate can be higher once your credit is assessed.

Watch out for a flat rate, which is sometimes quoted on car finance and older loan products. A flat rate charges interest on the whole original amount for the full term, ignoring the fact that you are steadily paying the balance down. A flat rate of 5% can work out close to double that as an APR. Always ask for the APR so you are comparing like with like. The APR calculator and the car finance calculator are useful when a dealer quotes a flat or monthly figure and you want the true annual cost.

Total cost of borrowing and how the term changes it

The headline most people focus on is the monthly payment, but the number that protects your wallet is the total interest. Stretching a loan over a longer term lowers the monthly payment, which feels easier, yet it almost always increases the total you pay because interest has more time to accrue.

Take the same £10,000 at 7.5% from example two. Over 5 years you pay about £200 a month and roughly £2,023 in interest. Shorten it to 3 years and the monthly payment rises to about £311, but the total interest falls to about £1,198. You pay £109 more each month and save more than £800 overall. That trade-off is the single most useful thing this loan calculator shows you: pick the shortest term whose monthly payment you can comfortably afford, and let the calculator confirm the saving.

Tips to borrow more cheaply

• Check your credit file first. A clean, up-to-date file gets you closer to the representative APR. Make sure you are on the electoral roll and that there are no errors.
• Use eligibility checkers, not full applications. A soft-search comparison shows your likely rate without leaving a hard footprint that can dent your score.
• Borrow only what you need. Lenders sometimes offer a better rate at a higher amount, but paying interest on money you don't need is a false economy.
• Pick the shortest affordable term. As the example above shows, a shorter term cuts total interest sharply.
• Check for early repayment terms. Overpaying or settling early can save interest. The early repayment calculator shows what clearing a loan ahead of schedule is worth.
• Budget before you borrow. Run the payment through a monthly budget calculator so the repayment fits your real outgoings, not your best month.

Common mistakes to avoid

• Judging a loan by the monthly payment alone. A low monthly figure often hides a long term and a high total cost. Always look at the total repaid.
• Confusing flat rate with APR. They are not the same, and a low-looking flat rate can be expensive once converted.
• Ignoring fees. Arrangement fees and credit insurance add to the cost. APR captures most fees, which is why it is the fairer comparison.
• Rolling expensive card debt into a loan without doing the maths. Sometimes it helps, sometimes it just spreads the pain. Compare it against your current cards with the credit card repayment calculator.
• Over-borrowing on a longer term to hit a target monthly payment. You feel comfortable now and pay far more later.

For impartial, official guidance on loans and your rights as a borrower, see MoneyHelper, the government-backed money advice service, and the Financial Conduct Authority, which regulates UK lenders. Only borrow from an FCA-authorised lender.

These results are estimates for guidance only and are not personal financial advice. Your actual rate, payments and total cost depend on the lender, your circumstances and the loan agreement you sign.

Related calculators

Compare a few options before you decide: the loan repayment calculator focuses on the repayment schedule, the how much can I borrow calculator helps you size a sensible amount, and the interest calculator shows how interest builds on any balance.

The numbers: what a £10,000 loan really costs

Monthly repayments and the total cost of borrowing £10,000 at typical UK personal loan APRs. Scale to your amount.

Lenders must show the APR including fees. Free debt and borrowing guidance: MoneyHelper.