Loan calculator
Enter the loan amount, annual interest rate and term to get your monthly payment.
Loan calculator: monthly payment and interest
This free loan payment calculator works out your monthly payment from the loan amount, the annual interest rate and the term, and tells you the total interest and total cost you will pay. Use it as a payment calculator for personal, car and consumer loans in the UK. Everything runs in your browser, with no sign-up. To go the other way and find the interest rate from a known payment, use our interest rate calculator.
How to use the loan calculator
- Enter the loan amount (the principal you borrow).
- Add the annual interest rate the lender quotes.
- Set the term and choose years or months from the dropdown.
You instantly get the monthly payment, the total interest and total cost, a chart of how the balance falls, and a year-by-year amortization schedule showing how much principal and interest you pay each year and the balance still owed.
How the payment is calculated
A fixed-payment loan uses the amortisation formula:
Where M is the monthly payment, P the principal, r the monthly interest rate (the annual rate divided by 12 and by 100) and n the number of payments (years × 12). The payment is constant, but the split between interest and principal changes every month.
Early on, most of the payment is interest because the outstanding balance is high; over time each payment repays more principal. That is why paying down early saves a lot of interest.
Key vocabulary
- Principal — the amount you borrow.
- Interest rate (APR vs nominal) — the nominal rate goes in the formula; the APR adds fees.
- APR — includes fees and charges; the fair figure for comparing offers.
- Term — the number of months to repay.
- Amortisation — repaying the loan in regular instalments.
Worked example
You borrow £15,000 at 8% a year over 5 years (60 payments). The monthly payment is about £304. In total you repay roughly £18,250, of which around £3,250 is interest. Shorten the term to 3 years and the payment rises, but you pay much less interest.
Frequently asked questions
Is a longer term better? It lowers the payment but raises total interest, because you borrow the money for longer. Choose the shortest term your budget allows.
Why compare by APR, not the headline rate? Two loans with the same nominal rate can have very different APRs once fees are included. APR reflects the true cost.
Can I repay early? Usually yes; early repayments remove interest from the rest of the term. Check for any early-repayment fees.
Related calculators: the mortgage calculator for home loans, and the interest rate calculator to find the rate from a known payment.