Loan Repayment Calculator

What this calculator does. It estimates the monthly repayment on any fixed-rate, fixed-term loan — personal loan, car loan, debt consolidation or small business loan — and shows you the total you'll repay across the term and the share of that which is pure interest.

How the calculation works. We use the standard loan amortisation formula. Your annual interest rate is divided by 12 to give a monthly rate, then applied to the outstanding balance each month. Each repayment first covers that month's interest, with the remainder reducing the principal. Because the balance falls over time, more of each later payment goes towards the principal even though the monthly figure stays constant.

A worked example. Borrow £10,000 at 7% APR over 5 years and the calculator returns a monthly payment of around £198, a total cost of about £11,880 and roughly £1,880 in interest. Shorten the term to 3 years and the monthly payment rises to around £309, but total interest drops to around £1,120 — a saving of £760 for paying it off two years sooner.

Why this matters. The monthly figure tells you whether the loan fits your budget; the total cost tells you what you actually pay for the convenience of borrowing. Seeing both side by side helps you balance short-term affordability against long-term cost — and decide whether stretching the term to make the payment manageable is genuinely worth the extra interest.

When to use it / when not to. Use it for any loan with equal monthly repayments and a fixed rate. Don't use it for credit cards, overdrafts or PCP car finance — those don't amortise to zero on a flat schedule and need a different approach (see our Credit Card Payoff calculator).

Common mistakes. Entering the monthly interest rate instead of the annual one (always enter the annual figure); ignoring arrangement or broker fees, which can add several percent to the true cost; and assuming the headline "representative APR" is the rate you'll get — by law, only 51% of accepted applicants need to receive it.