APR Calculator
The true annual percentage rate of a loan, fees included.
Quick answer
- Formula: APR solves: Loan received = Payment · (1 − (1+i)^−n)/i, APR = i × 12 × 100
- Worked example — Monthly payment: $888.49 (full example below).
APR Calculator
| Monthly payment | $888.49 |
| APR (true cost) | 12.00% |
| Total of all payments | $10,661.85 |
With no fees, APR equals the nominal rate: 12.00%. Add $500 of financed fees and the same loan's APR climbs above 21% — which is why fees matter.
Two loans with the same interest rate can cost very different amounts once fees are added. APR folds financed fees into a single annual rate so loans can be compared honestly.
Enter the amount you actually receive, the fees rolled into the loan and the nominal rate; the calculator finds the rate that makes the payments worth exactly the amount received.
The formula
Worked example
With no fees, APR equals the nominal rate: 12.00%. Add $500 of financed fees and the same loan's APR climbs above 21% — which is why fees matter.
The example is pre-loaded in the result panel — press Calculate with your own numbers to replace it.
Frequently asked questions
Why is APR higher than the interest rate?
Because you pay interest on the fees as well as the loan, while receiving only the loan amount. The APR expresses that total cost as a rate.
Is APR the same for mortgages?
Mortgage APR includes most closing costs but not all (for example, some third-party fees are excluded by regulation). It is still the best single comparison number between lenders.
Category: Finance calculators
Sources & methodology
This calculator applies the formula shown on this page exactly as written, using the standard definitions for its inputs. Results are computed from the values you enter — no data is stored — and are rounded only for display.
Content last reviewed by CalcHub Editorial.
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