Loan Repayment Calculator
Calculate monthly repayments and total interest on any personal loan.
What is the Loan Repayment Calculator?
A loan repayment calculator works out the fixed monthly payment needed to clear a personal loan over a set term, given the amount borrowed and the annual percentage rate (APR). It uses the same amortisation formula as a mortgage calculator — M = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1), where r is the APR converted to a monthly rate and n is the number of months — so that each payment covers that month's interest plus a portion of the capital, with the balance reaching zero at the final payment. To check it manually, divide your APR by 12 to get the monthly rate, then work through the formula with your loan amount and term in months.
How it works
Like a repayment mortgage, a standard personal loan is repaid through an amortisation schedule — a fixed monthly payment that combines interest and capital, structured so the loan is fully cleared by the end of the agreed term. Early payments are weighted more towards interest, later payments more towards capital, even though the monthly payment itself typically stays the same on a fixed-rate loan.
UK context
UK lenders are required to advertise a representative APR (Annual Percentage Rate) — the rate that at least 51% of successful applicants will actually receive — which bundles the interest rate with most mandatory fees into a single comparable figure. The rate you're personally offered can differ from the advertised representative APR based on your credit profile.
Tips
- Compare loans using the APR, not just the headline interest rate, since APR accounts for fees and gives a fairer like-for-like comparison.
- Check for early repayment charges before taking out a loan if you think you might want to clear it ahead of schedule — UK consumer credit rules limit how much lenders can charge for early settlement, but it varies by lender.
- A longer term lowers the monthly payment but increases total interest paid — always compare the total repayable amount, not just the monthly figure, across different term lengths.
Frequently asked questions
What's the difference between the interest rate and the APR on a loan?
The interest rate is the base cost of borrowing. APR (Annual Percentage Rate) includes the interest rate plus most mandatory fees, expressed as a single yearly rate, making it a fairer way to compare the true cost of different loan offers.
Why is the loan rate I'm offered different from the advertised rate?
UK lenders must advertise a "representative APR," which only has to be offered to at least 51% of successful applicants — the rest may be offered a higher rate depending on their credit history and circumstances.
Can I repay a personal loan early?
Most UK personal loans allow early repayment, though the lender may charge an early settlement fee (capped under UK consumer credit regulations). Paying off a loan early generally reduces the total interest paid overall.
Does a longer loan term always mean paying more interest overall?
In most cases yes, since you're paying interest for a longer period — even though the monthly payment is lower on a longer term. Always compare the total amount repayable, shown alongside the monthly figure.
A quick note
Figures and thresholds referenced above (tax bands, VAT rates, redundancy caps and similar) are set by the government and reviewed periodically — this page explains how the calculation works, not necessarily today's exact numbers. Always check the official sources below before making a financial decision, and see our full disclaimer.