Loan calculator.

When applying for a loan, knowledge is power. Calculate how much your loan could cost first. Get the right loan for you.

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Representative 34.9% APR.

Representative 34.9% APR. Representative Example: If you borrow £2000 over 24 months at a Representative 34.9% APR and an annual interest rate of 34.9% (fixed), you would pay 24 monthly instalments of £112.15. The total charge for credit would be £691.55 and the total amount payable would be £2691.55.

How does our loan calculator work?

The Choose Wisely loan calculator makes it easier to see how much your loan could cost, helping you to make an informed decision before applying.

By entering a few details into our loan payment calculator, we'll be able to show you how much you could expect to pay back to your lender each month and how much you'll have to repay in total.

Here's how the process works:

  1. Enter an amount you want to borrow - this can range from £100 to £10,000. Carefully consider how much you want this to be; you never want to borrow more than you need because this will increase the total cost of your loan.
  2. Enter the length of time you want to repay the loan. This can be a minimum of three months to a maximum of five years. This will have an impact on how much you repay each month. Usually the longer the loan, the smaller the monthly repayment amounts will be, but you'll pay more in interest overall.
  3. Alternatively you can also enter your desired monthly repayment amounts. Selecting an amount you want to pay each month can help you see how long it will take to pay off the loan fully.
  4. Enter an APR. Here you can input an APR, which is great if you already have a specific loan and APR in mind. If not, you can select if you have a good, fair, or bad credit rating, and our loan APR calculator will generate an approximate APR you're likely to be offered based on typical market rates.

Now you've got an understanding of how much a potential loan may cost, start your loan search by clicking “check eligibility”. After completing a short form you'll be presented with suitable loans for you to compare. These loan results will be personal to you and based on your current circumstances and credit history. Getting a quote using Choose Wisely's eligibility checker, won't impact your credit report.

Check Your Eligibility for a loan here

How are loan payments calculated?

The amount you have to repay each month when you take out a loan is influenced by the total amount you've borrowed, the interest rate of the loan and how long you want to be repaying the loan for.

If you borrow £1,000 with an APR of 12% and repay it over six months, you'll pay roughly £172.25 each month. Over twelve months, that same amount and APR will cost you around £88.56, according to our monthly repayment calculator.

How to calculate interest on a loan

The interest you have to pay on a loan is usually shown as APR (annual percentage rate). APR is shown as a percentage of the amount you borrowed and factors in any standard charges and costs.

To get a really rough idea of the amount of interest you'll need to pay on a loan, you can multiply the amount you've borrowed by the interest rate and then multiply that amount by the number of years you're repaying the loan over.

The thing is, this is only a rough estimation. In reality, it's really hard to calculate monthly interest without a rate of interest calculator.

Because it's difficult to work out how much interest you'll have to pay, it's always best to use our loan interest calculator to understand how much your loan may cost.

Why should I use a loan calculator?

Loan calculators can be a valuable tool because they can help you:

  • Compare the overall costs of two different loans
  • Help you to budget and make sure you can afford a loan
  • Calculate the interest rate that you'll pay on a loan
  • Help you to find the best deals

Why is my credit score important?

Your credit score helps providers to decide if they should lend to you based on how you've managed your finances in the past with other providers.

There are three core credit reference agencies in the UK - Experian, Equifax and TransUnion. Each agency collects information about you from lenders to create a credit report based on your borrowing and repaying habits.

Your credit report is then used as an indicator to new lenders about how reliable you are and the likelihood you'll pay them back.

The healthier your credit report is, the more likely you'll be accepted when you apply for things like loans, credit cards or a mortgage. You're also more likely to be offered better deals and cheaper borrowing if you have a good credit report.

The confusing thing is each credit reference agency holds different information about you and has its own unique way of ‘scoring' you. Experian scores out of 999, Equifax scores out of 700 and TransUnion scores out of 710.

The important thing to remember is that across all of them, the higher your score, the better.

If your circumstances change, your score may go up or down. Simply moving house could mean your score dips temporarily.

Lenders tend to do their own additional checks when you apply for credit with them. They'll consider things like your income, affordability and if you've ever defaulted on a payment with them directly in the past.

It's important to check your credit report before applying for any form of credit to make sure it's up to date and there are no mistakes on it. If you notice your score is very low, it might be worth waiting for six months and doing things to improve your score before applying for any new form of credit to give yourself the best chance of approval.

Loans Calculator FAQs

What is APR?

APR (Annual Percentage Rate) illustrates the total cost of borrowing. Shown as a percentage, the APR combines the interest rate of a loan and any additional charges to explain the total cost of a loan.

What impacts the total cost of a loan?

A loan's interest rate will impact the total cost - the higher the interest rate, the more it will cost you.

Some loans come with fees too, and these will also impact the overall cost of a loan.

Your credit history may also impact the total cost of your loan. If you're viewed as risky to lend to, the loan provider may charge you more in interest to cover themselves.

Mark Grimley
Written by
Mark Grimley
Head of Partnerships & Take Control Author at Choose Wisely

Mark joined Choose Wisely in 2015. He continues to work in close contact with the providers, brokers and journalists operating in the world of consumer credit.