APR Calculator
Calculate the true APR of a loan once fees are included, and compare it with the stated interest rate.
How APR is calculated
APR is the yearly rate that makes the present value of all your payments equal the money you actually received after fees. Because fees reduce what you receive but not what you repay, APR is higher than the stated rate. Example: a $20,000 loan at 6% over 60 months with $600 in fees has an APR of about 7.3%.
Frequently asked questions
What is the difference between APR and interest rate?
The interest rate is the cost of borrowing the principal. APR also reflects fees, so it shows the true yearly cost.
Which fees are included?
Typically origination fees, points and other required upfront charges. Enter the total you pay at closing.
Why compare APRs?
Two loans with the same rate can cost very different amounts. APR lets you compare the total yearly cost fairly.
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