Work out monthly repayments, total interest and how much extra payments save you — for any UK personal loan.
| Year | Balance | Interest paid | Principal paid |
|---|
UK personal loans use amortising repayments — each monthly payment is split between interest (charged on the outstanding balance) and principal (the amount you borrowed). In the early months, more of each payment goes to interest; as the balance falls, more goes to principal.
Monthly payment = P × r × (1+r)n ÷ ((1+r)n − 1), where P is the loan amount, r is the monthly rate (APR ÷ 12 ÷ 100), and n is the total number of monthly payments.
By FCA rules, lenders must advertise a representative APR that at least 51% of accepted applicants receive. Your actual rate may be higher based on your credit profile. Always compare the total amount repayable, not just the monthly figure.
Many UK personal loans allow overpayments. Even modest extra payments dramatically reduce total interest because they reduce the outstanding balance on which future interest is calculated. Always check your loan agreement for early repayment charges.
The calculator above does this for you, but the arithmetic is short enough to check on a phone calculator. This uses Emma's loan from the worked examples below: £8,000 at 6.9% APR over 3 years.
In the first month, interest is charged on the full £8,000: £8,000 × 0.00575 = £46.00. The rest of the £246.65 payment, £200.65, reduces the balance. Because the balance falls every month, the interest share falls too:
| Year | Interest paid | Balance at year end |
|---|---|---|
| Year 1 | £474.37 | £5,514.56 |
| Year 2 | £297.35 | £2,852.10 |
| Year 3 | £107.72 | £0 |
More than half of the interest is paid in the first year. That is why an overpayment early in a loan saves more than the same overpayment near the end.
A longer term lowers the monthly payment but increases the total interest. The same £8,000 at 6.9% APR:
| Term | Monthly payment | Total interest |
|---|---|---|
| 2 years | £357.82 | £587.63 |
| 3 years | £246.65 | £879.44 |
| 5 years | £158.03 | £1,481.95 |
| 7 years | £120.35 | £2,109.46 |
Totals use the unrounded monthly payment, as the calculator does, so they can differ by a few pence from the rounded payment × the number of months. These figures assume the rate stays the same for every term. In practice lenders often price different terms and amounts differently, so check the rate you are actually offered for each option.
When comparing offers, put each one into the calculator and compare the total repaid. A lower monthly payment over a longer term can cost more overall. If you already have a credit card balance, the credit card repayment calculator shows how long it would take to clear on its own. The guide should you overpay debt or save? covers what to do with spare cash once a loan is running, and the budget planner helps check that a monthly payment fits your outgoings.
This calculator applies standard amortisation arithmetic. Regulatory context is linked below. Checked on 2 September 2026.
Official figures this calculator applies
UKCalc assumptions — not official figures
Early settlement. Regulated loans allow early repayment, but lenders may add up to 58 days' interest as a settlement charge. Check the agreement before assuming overpayment saves the full projected interest.