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Assumes a fixed rate and equal monthly repayments over the full term. The APR a lender advertises is a representative rate: only 51 percent of accepted applicants must get it, so your offer may differ. Estimates only, not financial advice.
What The Loan Repayment Calculator Works Out
- Monthly repayment: the standard amortisation formula using the loan amount, the monthly rate (APR divided by 12) and the number of months. GBP 10,000 at 6% over five years is about GBP 193 a month. Personal loan APRs typically run from around 6% for the best credit profiles on GBP 7,500 to GBP 15,000, up to 20% to 30% for small loans or weaker credit.
- Total repaid: the monthly payment multiplied by the number of payments, plus any fee paid upfront.
- Total interest: total repaid minus the amount borrowed. Stretching the same loan from five years to seven cuts the monthly figure but adds hundreds of pounds of interest; the shortest term you can comfortably afford is almost always cheapest.
- Arrangement fee (advanced): some loans (and most mortgages and car finance deals) charge a set-up fee, often GBP 0 to GBP 300 on personal loans. Added to the loan it attracts interest; paid upfront it does not.
- Monthly overpayment (advanced): a fixed extra amount every month. Overpaying shortens the term rather than reducing the payment, so the saving shows up as interest avoided and months knocked off.
- One-off overpayment (advanced): a lump sum in a chosen month, such as a bonus or inheritance. The earlier it lands, the more interest it saves. Lenders must allow early repayment on regulated loans, though they can charge up to about one to two months' interest on larger sums.
- Total cost of credit (advanced): interest plus fees, which is the figure to compare between lenders rather than the headline APR alone.
- Paid off in (advanced): the actual time to clear the balance once overpayments are included, and how many months early that is.
- Year-by-year schedule (advanced): what you paid, how much of it was interest, and the balance left at the end of each year. Early payments are mostly interest and late payments mostly capital, which is why overpaying early matters most.
Source and further reading: MoneyHelper.