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Personal loan calculator

Monthly payments, interest, total cost and APR for a fixed-rate loan repaid each month.

Personal loan calculator

What you want to borrow, before any fee.

£

For example 48 for 4 years, up to 120 months.

The rate you have

The APR is the headline rate in adverts and quotes and includes compulsory charges. The interest rate covers interest only.

As a percentage, for example 5.9.

%

Monthly payment

—

Enter the amount, term and rate to see the monthly payment.

APR
—
Annual interest rate
—
Total interest
—
Total cost (interest, fee and insurance)
—
Total to pay
—

Year-by-year breakdown

The table appears once the loan is worked out.

Recent calculations

Nothing yet: copy, export or save a calculation to find it here.

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See all 14 apps in Loans and credit

How it works

Enter the amount, the term in months and the rate: the calculator gives the monthly payment, the total interest, the total you will pay and the APR, with every step of the working and a year-by-year breakdown. It covers fixed-rate personal loans repaid in equal monthly payments, not credit cards or overdrafts. The rules are the same across the UK: the Consumer Credit Act 1974 applies in England, Wales, Scotland and Northern Ireland alike.

Choose the rate you have

Adverts and quotes headline the APR (annual percentage rate), which includes interest and any charges you must pay to get the loan. If you have the APR, choose ‘APR’: the monthly payment is worked out from the equivalent monthly rate. If you have the interest rate, which covers interest only, choose ‘Interest rate’ and add any arrangement fee and insurance; the calculator then works out the APR.

Fees and insurance

An arrangement fee is treated as paid on the day you receive the money. Insurance the lender requires is part of the APR; optional cover is not, but it is counted in the total cost. Neither is added when you enter an APR, because the APR already includes them.

Rounding

The monthly payment is rounded to the nearest penny, a half penny rounding up, and so is each month’s interest. The last payment clears what is left, so it can differ by a few pence, or by a few pounds or more on a long loan at a high rate. If the rounded payment would repay the loan before its last month, which happens with a small loan over a long term at a high rate, it is taken a penny lower and the last payment is larger. An APR worked out from an interest rate is shown to one decimal place, the least precision the APR rules allow; an APR you enter is used as it is.

Monthly rate: r = interest rate ÷ 12, or r = (1 + APR)^(1/12) − 1 when you enter an APR.

Monthly payment = C × r ÷ (1 − (1 + r)^−n), where C is the amount borrowed and n the number of payments.

Total interest = total of the payments − C.

APR: the rate X at which the amount you receive (C less any fee) equals the sum of the payments, each divided by (1 + X)^(k/12), k being the month number.

Example: £7,500 over 60 months at an interest rate of 6.22%

The monthly rate is 6.22% ÷ 12 = 0.518333%. Monthly payment = £7,500 × 0.518333% ÷ (1 − (1 + 0.518333%)^−60) = £145.76; the 60th payment, which clears the balance, is £146.06. Interest comes to £1,245.90, so you pay £8,745.90 in all, and the APR is 6.4%.

Frequently asked questions

What is the difference between the APR and the interest rate?

The interest rate is what the lender charges on the balance. The APR adds the charges you must pay to get the loan, such as an arrangement fee or compulsory insurance, and expresses the whole cost as a yearly rate, so it is the figure to compare loans with. The method used here is the one in the Consumer Credit (Total Charge for Credit) Regulations 2010: payments are discounted month by month, a year counting as 12 equal months, and the result is given to at least one decimal place. Since 1 April 2014 those rules have been in the FCA Handbook (CONC App 1.2).

Can I change my mind after signing?

Yes. You can withdraw from most regulated consumer credit agreements without giving a reason within 14 days, counted from the day after the agreement is made or after you receive your copy of it, whichever is later. You then repay the money and the interest for the days you had it within 30 days, with no other fee apart from any non-returnable charge the lender paid to a public body (Consumer Credit Act 1974, s. 66A).

Can I repay the loan early, and what can the lender charge?

You can repay all or part of the loan early at any time (s. 94). On a fixed-rate loan the lender may ask for compensation only if you repay more than £8,000 in any 12 months. It must be fair and objectively justified, and cannot exceed 1% of the amount repaid early when more than a year of the loan is left, or 0.5% when a year or less is left, nor the interest you would have paid over that time (s. 95A).

Why is the last payment different from the others?

The monthly payment and each month’s interest are rounded to the penny. Those small differences build up, with interest, over the term, and the last payment, which repays exactly what is left, absorbs them. Over several years the gap can reach tens of pence, and a few pounds at a high rate; the calculator points it out from £1. On a small loan over a long term at a high rate it can be more than the payment itself, and the working says so. A lender’s schedule can differ by a few pence if it rounds differently or charges interest by the day.

Sources

  1. legislation.gov.uk: Consumer Credit (Total Charge for Credit) Regulations 2010, Schedule (calculation of the APR), version of 26 July 2013 (26 July 2013)
  2. legislation.gov.uk: Directive 2008/48/EC, Annex I (the APR equation and its assumptions) (31 January 2020)
  3. legislation.gov.uk: Consumer Credit Act 1974, s. 193 (the Act extends to Northern Ireland) (31 July 1974)
  4. legislation.gov.uk: Consumer Credit Act 1974, s. 66A (withdrawal within 14 days) (1 February 2011)
  5. legislation.gov.uk: Consumer Credit Act 1974, s. 94 (right to repay early) (1 February 2011)
  6. legislation.gov.uk: Consumer Credit Act 1974, s. 95A (compensation for early repayment) (1 February 2011)

This calculator gives general information, not legal, financial or tax advice. The lender’s credit agreement is what counts: check the monthly payment, APR and total amount payable it shows before you sign.

Last reviewed: