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Personal Loan Calculator
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How it works
Personal loans use the standard annuity formula: M = P × r / (1 − (1+r)−n), where P is principal, r is the monthly rate (APR ÷ 12) and n is the number of months.
Each payment is part interest and part capital. Early payments are mostly interest; later payments mostly capital.
Worked example
Borrow £10,000 over 3 years at 9.9% APR.
- Monthly: £322.33
- Total: £11,604
- Interest: £1,604
Who should use this
- •Anyone considering a personal loan
- •People comparing two loan offers
- •Refinancing or consolidating existing debt
Common mistakes
- ×Choosing a longer term to lower the monthly cost — interest balloons
- ×Comparing flat rate vs APR (APR is always the truer comparison)
- ×Ignoring early-repayment penalties
- ×Forgetting that 'representative APR' is only offered to ~51% of accepted applicants
Frequently asked questions
What's a good personal loan APR?▾
For prime borrowers, sub-7% on amounts £7,500-£25,000. Smaller loans typically run 12-25% APR.
Does applying hurt my credit score?▾
A formal application leaves a hard search. Use soft-search 'eligibility checkers' first.
Can I overpay a personal loan?▾
Yes, but lenders can charge up to 58 days' interest as an early settlement fee under the Consumer Credit Act.
What's the difference between secured and unsecured loans?▾
Secured loans use your home or car as collateral — usually lower rates but you risk the asset. Unsecured loans rely on credit alone.