LoanComparisonTools

Loan APR Calculator

Turn a rate plus fees into an APR and see how much of the real cost the advertised rate leaves out.

Last reviewed

·

Free · No sign-up · Runs in your browser

The advertised rate on a loan describes the interest and nothing else. The APR describes what the loan costs once the fees are included, and on a fee-heavy product the two can be a full percentage point apart.

This calculator solves for the APR implied by a rate plus the charges you enter, and reports the premium so the fees are visible as a rate rather than as a number in the small print.

Your numbers

Results update as you type. Nothing is sent anywhere.

Result

APR

13.66%

APR above the nominal rate

2.76%

Nominal rate
10.9%
Total fees
$900
Cost of points
$0
Amount financed
$17,100
Monthly payment
$464
Total interest
$4,289

APR spreads the up-front fees across the full term. Paying the loan off early makes the true cost of those fees higher than the APR suggests.

Comparing two offers by APR only works when both use the same term and the same fee set.

How to use the loan apr calculator

  1. Enter the amount borrowed, the nominal rate and the term.
  2. Enter the origination fee and any other lender charges.
  3. Enter points as a percentage of the amount, if applicable.
  4. Compare the APR against the nominal rate.

What people use this for

  • Comparing a low-rate loan with fees against a higher-rate loan without.
  • Checking whether a lender’s disclosed APR matches the charges quoted.
  • Understanding what an origination fee is costing you.
  • Deciding whether a fee is worth paying for a lower rate.

Worked examples

Every figure below is produced by running this calculator against the example inputs, so the numbers always match the tool.

A fee-heavy personal loan

$18,000 at 10.9% over 4 years with a $700 origination fee and $200 of other charges.

APR
13.66%
APR above the nominal rate
2.76%
Total fees
$900

A no-fee loan at a higher rate

The same amount and term at 12.2% with no charges at all.

APR
12.2%
Monthly payment
$476
Total interest
$4,837

A fee deducted from the advance is more expensive than it looks

When a $700 origination fee is taken from the amount advanced, you receive $17,300 and repay interest on $18,000. The effective cost is higher than the fee alone, and APR is the standard way of expressing that.

The two examples above are the point: the offer with the lower nominal rate and a fee, against the higher-rate offer with none. Which is genuinely cheaper is not obvious until the APRs are compared.

Early repayment breaks the comparison

APR spreads the fee across the full term. Repay a four-year loan in eighteen months and the same fee is spread across a third of the payments, which more than doubles its effective cost.

If early repayment is likely, compare the fee in cash terms alongside the APR. The fee-free option frequently wins on that basis even when it loses on APR.

Methodology and assumptions

What this calculator does, and what it deliberately does not do.

  • The payment comes from the nominal rate and term. APR is the rate equating that payment stream to the amount net of fees, solved by bisection.
  • Points are a percentage of the loan and are added to the fee total.
  • Which charges a lender includes in a disclosed APR varies; this includes exactly what you enter.
  • Results are estimates. Real quotes depend on credit, income, property, loan programme and lender pricing at the time of application.
  • Nothing you type is transmitted or stored - the calculation runs entirely inside your browser.

This calculator is provided for informational and educational purposes only. Results are estimates and may not reflect actual rates, fees, taxes, or market conditions.

This website is not a lender, a mortgage broker or a financial adviser. It does not originate loans, does not accept applications and does not forward your details to anyone.

Actual loan terms depend on credit history, income, the property, the loan programme and lender pricing at the time of application. Only a lender can tell you what you qualify for.

Frequently asked questions

Why does APR exceed the interest rate?

Because it includes fees. Where there are none, the two figures are effectively identical.

Is the lowest APR always best?

For a loan held to term, generally yes. For one likely to be repaid early, a fee-free option at a higher rate frequently costs less.

Do lenders calculate APR the same way?

Regulations define which charges must be included, but treatment of third-party costs varies. Compare like with like.

Does APR include payment protection insurance?

Usually not unless it is a condition of the loan. If it is optional, price it separately.

Related calculators

More loan comparison tools on LoanComparisonTools.

Browse all 4 tools →