Loan Balance Transfer Calculator UK
Compare your current loan with a balance transfer to a lower rate, net of processing fee.
How it works
Compound interest earns returns on both your original money and the returns already added. Adding a regular monthly contribution accelerates growth further over time.
A = P(1 + r/n)^(nt) + contributions compounded monthly- Longer time horizons benefit most from compounding
- More frequent compounding gives slightly higher growth
- The donut shows how much of your final balance is interest vs money you put in.
Frequently asked questions
What is a balance transfer?
Moving outstanding debt to a new lender at a lower rate to reduce the interest you pay over the remaining term.
When is a balance transfer worth it?
When the rate reduction is significant, the balance is large, and enough time remains for the saving to exceed the fees.
What fees are involved?
Credit-card transfers often charge around 2–5% of the balance; remortgaging carries arrangement, valuation and legal fees.
Does a balance transfer affect my credit?
A new application may cause a small temporary dip, but reducing your interest and clearing balances can be positive over time.
How do I find my real saving?
Subtract all fees from the interest you would save at the new rate. If the result is clearly positive, the transfer helps.
What happens after a 0% deal ends?
The rate usually jumps to a much higher standard rate, so aim to clear the balance before the introductory period ends.
What a balance transfer does
A balance transfer moves outstanding debt — a loan or credit-card balance — to a new lender at a lower rate, cutting the interest on what you owe. The saving must be weighed against any fees and the time left on the debt.
When it is worth it
A transfer tends to pay off when the rate drop is meaningful, the balance is sizeable and a good chunk of the term remains. Near the end of a loan, when little interest is left to charge, the saving is often too small to justify the effort.
Count the fees
Credit-card balance transfers commonly charge a one-off fee of around 2–5% of the balance, while remortgaging carries arrangement, valuation and legal costs. Subtract every fee from the projected interest saving to find the real benefit.
Worked example
Moving a £5,000 credit-card balance from 22% to a 0% introductory deal for 18 months could save hundreds in interest; if the transfer fee is 3% (£150), you subtract it to confirm the move still comes out ahead — and aim to clear it before the deal ends.
Results are estimates for general guidance in United Kingdom and may not reflect the latest local rates, fees or rules. Check official sources before making decisions.