Personal Loan Calculator
Estimate the monthly payment, total interest and origination fee on a fixed-rate unsecured personal loan, and see the true cost of borrowing once fees are included.
Monthly payment
£322.67
- Total repayment
- £11,616.19
- Total interest
- £1,616.19
- Origination fee
- £500.00
- Net cash received
- £9,500.00
- True cost of borrowing
- £2,116.19
A personal loan is repaid in fixed monthly instalments that cover both interest and principal. Origination fees are deducted from the cash you receive but you still repay the full loan amount, so the true cost is interest plus fee. Comparing two offers by monthly payment alone hides the fee — the APR is the more honest comparison number.
How to use this calculator
Enter the loan amount, the annual interest rate quoted by the lender, the term in months, and any origination fee charged as a percentage of the loan. The calculator returns the fixed monthly repayment, the total amount you will pay back over the life of the loan, the breakdown between interest and fees, and the net cash you actually receive after the fee is deducted.
How the calculation works
The monthly payment uses the standard amortisation formula P = L × r / (1 − (1+r)^−n), where L is the principal, r is the monthly rate (annual rate ÷ 12), and n is the number of months. Total interest is monthly payment × n − L. The origination fee is a flat percentage of the loan amount, deducted by the lender from your disbursement but still owed in full. Two loans with identical monthly payments can have very different true costs once fees are accounted for — that is why the calculator also shows the net cash received and the total cost of borrowing.
Worked example
A 10,000 personal loan at 10% over 36 months gives a monthly payment of about 322.67. Total repayment is 11,616.19, of which 1,616.19 is interest. With a 5% origination fee the lender keeps 500 up front, so you receive 9,500 in cash but still owe the full 10,000. True cost of borrowing is 2,116.19.
Frequently asked questions
How is a personal loan payment calculated?
A standard amortising personal loan uses the same payment formula as a mortgage or car loan: P = L × r / (1 − (1+r)^−n). L is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments. Every payment is the same size, with the interest share falling and the principal share rising over time.
What is an origination fee and does it change the monthly payment?
An origination fee is a one-off charge — typically 1% to 10% of the loan amount on a personal loan — that the lender deducts from the cash disbursed at drawdown. It does not change the monthly payment, which is still calculated on the full loan amount, but it does raise your true cost. A 5% fee on a 10,000 loan means you receive 9,500 in cash but still repay the full 10,000 plus interest.
Is the interest rate the same as the APR?
No. The interest rate is the cost of borrowing the principal. The APR (annual percentage rate) bundles the interest rate together with origination fees and any other mandatory charges, so it is the more accurate comparison number between lenders. This calculator works in interest rate plus a separate fee so you can see both sides — a 10% loan with a 5% origination fee is closer to a 13–14% APR on a three-year term.
What is a typical term for a personal loan?
Most unsecured personal loans run 12 to 84 months, with 36 and 60 months being the most common. A shorter term means a higher monthly payment but far less interest paid overall. A longer term lowers the monthly payment but can double or triple the total interest, so only stretch the term out if cash flow truly requires it.
Does this work for debt-consolidation, medical or wedding loans?
Yes — any unsecured fixed-rate fixed-term loan with a single up-front origination fee uses the same math. That covers most debt-consolidation, medical, home-improvement, wedding and emergency personal loans from banks, credit unions and online lenders. It does not model variable-rate loans, interest-only periods, balloon payments, or revolving credit like credit cards and lines of credit.
How can I lower the true cost of a personal loan?
Compare lenders on APR or total cost of borrowing (interest + fees), not the monthly payment. Improve your credit score before applying — even a 50-point bump can drop the rate by several percentage points. Pick the shortest term you can afford. Ask whether the origination fee is negotiable, and whether prepayment is allowed without penalty so you can pay down early when cash flow permits.