Total Cost of Credit Calculator
Understand the true cost of borrowing. Enter your loan amount, APR, and term to see the monthly payment, total interest charged, and the total amount repayable over the life of the agreement.
Frequently asked questions
What is the total cost of credit?
The total cost of credit is the total amount you repay over the life of a loan minus the amount you originally borrowed. It equals the sum of all interest charged. A higher APR or longer term increases the total cost of credit.
How can I reduce the total cost of credit?
Pay a larger deposit to reduce the amount borrowed, choose a shorter term, or negotiate a lower APR. Even a small reduction in APR saves significant money over a multi-year loan.
Is APR the only cost of car finance?
No. Some agreements include arrangement fees, option-to-purchase fees (PCP), or early settlement charges. APR should include most fees, but always check the credit agreement for the full list of charges.
Why does a longer term mean more interest?
With a longer term, you repay the principal more slowly, so the outstanding balance stays higher for longer. Interest is charged on the outstanding balance each month, so the total interest accumulates over more months.
These calculations are estimates based on 2026/27 HMRC and DVLA rates. Speak to a lender or qualified financial adviser for a personalised quote.