Loan Calculator
Estimate fixed-rate loan repayments, total repaid, and interest based on principal, annual rate, and term.
Inputs
Result
Enter values on the left and select Calculate to see the result here.
What the Loan Calculator does
- Estimates the regular monthly repayment for a fixed-rate instalment loan based on the principal, annual interest rate, and term you enter.
- Shows the estimated total amount repaid and total interest over the repayment term.
- Provides a simple comparison point before reviewing a month-by-month Amortization Calculator schedule.
How to use the Loan Calculator
- Choose the currency used for the loan figures.
- Enter the principal, meaning the amount borrowed or financed.
- Enter the annual interest rate as a percentage and the loan term in years. The calculator converts the term into monthly repayments.
- Click Calculate to estimate the monthly payment, total repayment, and total interest based on your inputs.
- Compare terms carefully: a longer term can reduce the monthly payment but increase total interest.
Formula / methodology used
- The annual percentage rate entered is converted into a monthly rate by dividing by 12 and by 100.
- The number of repayments is the loan term in years multiplied by 12.
- For a standard amortised loan the calculator uses M = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where P is principal, r is monthly rate, and n is monthly payments.
- For a zero-interest loan it divides the principal evenly across the monthly payments: M = P ÷ n.
- Total repayment = monthly payment × n. Total interest = total repayment − principal. Displayed currency values are rounded to 2 decimal places.
Example calculation
A £12,000 car loan at 7.2% annual interest over 5 years.
- Principal = £12,000
- Monthly rate = 7.2 ÷ 12 ÷ 100 = 0.006
- Number of payments = 5 × 12 = 60
- Using the amortised loan formula, monthly payment ≈ £238.75
- Total repayment ≈ £238.75 × 60 = £14,324.90, so total interest ≈ £2,324.90
Result: The calculator would estimate a monthly payment of about £238.75, total repayments of about £14,324.90, and total interest of about £2,324.90.
Common mistakes and limitations
- This is an estimate based on your inputs and is not a loan quote, approval, affordability assessment, or financial advice.
- It does not include lender fees, broker fees, insurance, late fees, early repayment charges, variable-rate changes, credit checks, affordability checks, taxes, or product-specific terms unless you explicitly add them to the principal or adjust the assumptions.
- The calculator assumes monthly payments are made on time and the rate remains unchanged for the whole term.
- Do not mix monthly and annual rates; the interest input expects an annual percentage rate-style figure.
- Real lenders may round payments differently or calculate interest daily, so statements can differ slightly.
Important note
This loan calculator provides an educational estimate based on your inputs. It is not a loan quote, lending decision, or financial advice. Confirm rates, fees, insurance, eligibility, affordability, and contract terms with the lender before borrowing.
Loan Calculator FAQs
Is this a loan quote?
No. It is only an estimate based on the principal, rate, and term entered. A lender quote may depend on credit checks, fees, affordability, and product terms.
Can I use it for a car loan or personal loan?
Yes, for a simple fixed-rate monthly repayment estimate. Enter the amount financed, annual rate, and term.
Are lender fees or insurance included?
No. If a fee is financed into the loan, you can add it to the principal; otherwise budget for it separately.
What happens at 0% interest?
The calculator divides the principal evenly across the monthly payments, so total interest is £0, €0, or $0 depending on the selected currency.
How is this different from the Mortgage Calculator?
The Loan Calculator is a simpler fixed-loan tool. The Mortgage Calculator includes property price, deposit, and optional recurring ownership-cost inputs.