Personal Loan Calculator

A personal loan’s true cost depends on three numbers working together — the amount borrowed, the APR, and the term — and seeing exactly how they combine, rather than judging a loan by its monthly payment alone, is what genuinely reveals whether a specific offer is a good one. This calculator works out your monthly repayment, total interest, and total repayable for any combination of the three.

The Rate You See Isn’t Necessarily the Rate You Get

UK lenders are only required to offer their advertised “representative APR” to 51% of successful applicants — the remaining 49% can legally be offered a higher rate based on their individual credit assessment, without that being considered false advertising. This is worth understanding clearly before assuming the advertised headline rate is what you will personally receive: it is a genuine possibility, not a guarantee, and running this calculator with a slightly higher rate than advertised gives a more realistic sense of what your actual offer might look like once a lender has assessed your specific circumstances.

This is genuinely worth bearing in mind specifically when a headline rate seems unusually attractive compared to the rest of the market — it is worth checking whether that rate is realistically available to someone in your specific circumstances, rather than assuming the best-advertised rate on a comparison site is automatically the rate you personally would be offered.

Why “Cost Per £1,000” Is the Number Worth Comparing

Comparing two loan offers of different sizes by their total interest figure alone can be misleading, since a larger loan naturally produces more total interest even at an identical rate and term. This calculator includes a “cost per £1,000 borrowed” figure specifically to strip out the effect of loan size, leaving a genuinely comparable number between offers — a loan costing £180 per £1,000 borrowed is more expensive, pound for pound, than one costing £140 per £1,000, regardless of how large either loan actually is. This is a more reliable way to compare rate quality across different amounts than the total interest figure alone.

Seeing the Normalisation in Practice

A £6,000 loan at 11.9% over 3 years produces roughly £1,164 in total interest — which sounds smaller than the £2,576 total interest on an £18,000 loan at 8.9% over the same term, but comparing the two directly is misleading given how different the loan sizes are. Normalised to cost per £1,000 borrowed, the smaller £6,000 loan actually costs around £194 per £1,000, considerably more than the larger loan’s £143 per £1,000 — the larger, lower-rate loan is genuinely the better rate, even though its raw total interest figure looks bigger at first glance.

What Your Credit Tier Roughly Buys You

Personal loan rates vary considerably by self-assessed credit tier: excellent credit typically sees offers in the 6.9–9.9% APR range, good credit around 10–15%, fair credit 16–25%, and poor credit 26% and upward, sometimes considerably higher for genuinely weaker credit profiles. The gap between the best and worst of these bands is substantial — on an identical loan amount and term, the difference between an excellent-credit rate and a poor-credit rate can easily double or triple the total interest paid, which is worth keeping in mind both when shopping around and when considering whether improving your credit position before applying could be worthwhile. Our Loans Eligibility Calculator is a useful next step for a more detailed, soft-search-only assessment of which tier you are likely to fall into before applying for real.

The Term Length Trade-off Most People Get Backwards

A longer term produces a lower monthly payment, which understandably feels like the more affordable option, but it also means paying interest for longer, which increases the total interest paid over the life of the loan even at an identical rate. This is not a reason to always choose the shortest term available — for many people, a monthly payment that is genuinely comfortable matters more than minimising total interest to the last pound — but it is worth seeing the total interest figure at a couple of different term lengths side by side before deciding, rather than choosing based on the monthly payment figure in isolation. Running the same loan amount and rate through this calculator at two or three different term lengths takes only moments and makes the genuine trade-off between monthly affordability and total cost considerably clearer than trying to estimate it mentally. Our Loan Interest Calculator breaks this down further, showing exactly how much of each individual payment goes toward interest versus the capital balance across the term.

Frequently Asked Questions

Important Information

This calculator provides an estimate based on the figures you enter and does not constitute financial advice or a loan offer. Actual rates and terms depend on individual lender assessment. For advice specific to your circumstances, consult a qualified financial adviser. See our Disclaimer for further information.