1. What is the UK Personal Loan Debt Calculator?

This calculator determines the remaining balance on a UK personal loan with fixed monthly payments. It's useful for understanding how much you still owe or for comparing loan options.

2. How Does the Calculator Work?

The calculator uses the loan balance formula:

Where:

• \( B \) — Remaining balance (GBP)
• \( PMT \) — Monthly payment amount (GBP)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Remaining number of monthly payments

Explanation: The formula calculates the present value of the remaining loan payments at the current interest rate.

3. Importance of Loan Balance Calculation

Details: Knowing your remaining balance helps with financial planning, refinancing decisions, and understanding your debt position. It's particularly important when considering early repayment or loan consolidation.

4. Using the Calculator

Tips: Enter your fixed monthly payment in GBP, the annual interest rate (APR) as a percentage, and the remaining term in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Does this work for variable rate loans?
A: No, this calculator assumes a fixed interest rate throughout the remaining loan term.

Q2: How accurate is this calculation?
A: It's mathematically precise for fixed-rate loans with consistent monthly payments, excluding any potential fees or charges.

Q3: Can I use this for mortgage calculations?
A: While the formula is similar, mortgages often have different terms. Use a dedicated mortgage calculator for those.

Q4: Why does my lender's balance differ slightly?
A: Lenders may use slightly different calculation methods or include fees not accounted for here.

Q5: How can I reduce my remaining balance faster?
A: Making additional payments or increasing your monthly payment will reduce the balance faster and save on interest.