APR Calculator
Find the true APR of a loan including fees.
Result
Results are estimates for general information only and are not professional advice.
What APR really measures
The nominal interest rate describes only the interest. The Annual Percentage Rate describes the whole cost of borrowing — interest plus the arrangement fees, administration charges and points that are deducted before the money reaches you. Because lenders can advertise a low headline rate while recovering margin through fees, APR is the only figure that lets you compare two offers honestly.
The formula behind it
The payment is calculated from the nominal rate on the full loan amount. The APR is then the rate that makes those same payments equal the amount you actually received — the loan minus the fees — solved iteratively, since the equation has no closed form. Borrow 20,000 at 8% over five years with 800 in fees and you repay as though you borrowed 20,000 while only receiving 19,200: an APR closer to 9.7%.
How to use this calculator
Enter the loan amount, the total fees and costs, the nominal rate and the term in years. The result shows the monthly payment and the true APR. Run each competing offer through it — the ranking by APR frequently reverses the ranking by headline rate.
Comparing offers with it
APR is only comparable between loans of the same term; spread over a longer period, the same fees produce a lower APR, which can make a more expensive loan look cheaper. Watch for costs excluded from a quoted APR, such as compulsory insurance, and remember that on variable-rate products the APR assumes today's rate holds for the whole term, which it rarely does.
Frequently Asked Questions
What is the APR Calculator?
Find the true APR of a loan including fees. It runs instantly in your browser and is completely free to use.
What do I need to enter to use the APR Calculator?
The APR Calculator asks for the following values (4): Loan amount, Fees & costs, Nominal rate (%), Term (years). Fill them in and the result appears immediately — the calculation runs on your own device, so nothing you type is sent to a server.
How accurate is the APR Calculator?
The APR Calculator uses standard, widely-accepted formulas, so its figures are reliable estimates for everyday planning. They are not a substitute for advice from a qualified professional.
Is the APR Calculator free, and do I need an account?
Yes. The APR Calculator — and every other calculator on Calculatis — is completely free, with no registration, no download and no limit on how often you use it.