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Will the length of a loan effect the APR I get?

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If I get a loan for a longer period (say 5 years instead of 3) will my likely APR be lower or higher?

I think lower because I'll be paying for longer and therefore they'll get more money from me in the long term.

But then I think higher APR because it'll take them more time to retreive their money, so a higher risk that I'll default?

What do you think?

And also, is there a calculator on this site which shows roughly what my monthly repayments would be if I took out a loan for X amount, for Y years and at Z APR?

Thanks :A

Comments

  • MFWannabe
    MFWannabe Posts: 2,457 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    Hi
    I don't think the APR changes dependant on the term on the loan
    It changes dependant on how much you want to borrow; over 7.5k and it is usually lower.
    The APR you will be offered may differ fom what is 'offered' on websites; which is why they say for example: loans from 7.9% APR
    It really depends how much you want to borrow; if it's a few thousand then a credit card may be cheaper than a loan
    There is a loan caluclator in the Cards/Loans links at the top of the page which will tell you how much interest you will pay over the term of the loan
    MFW 2025 #50: £1139.75/£6000

    12/06/25: Mortgage: £65,000.00
    07/03/25: Mortgage: £67,000.00
    18/01/25: Mortgage: £68,500.14
    27/12/24: Mortgage: £69,278.38 

    27/12/24: Debt: £0 🥳😁
    27/12/24: Savings: £12,000

    07/03/25: Savings: £16,500

  • ~Brock~
    ~Brock~ Posts: 1,715 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    If the loan includes fixed costs such as arrangement fees then the APR will become slightly lower as the term increases to reflect the increased time allowed for the payment of these fees.
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