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APR Calculator

Calculate Your Annual Percentage Rate for Mortgages and Other Loans.

See the APR (Annual Percentage Rate) behind any offer-the standardized yearly cost that blends interest, term length, and required fees into one comparable number. It’s most useful when you’re weighing mortgages, auto loans, personal loans, or balance-transfer promos where a low payment can mask expensive charges.

The apr calculator lets you run quick what-ifs to reveal the true borrowing cost and compare offers on equal footing. The goal is to cut through teaser rates and marketing math-so you can decide which option is genuinely cheaper, understand when points or origination fees might pay off, and feel confident before you sign.

Calculate real APR including fees and points. See payments, total interest, and compare the true cost of borrowing across loan offers.

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General APR Calculator
Real APR: 6.563%
Amount Financed$100,000.00
Upfront Fees$2,500.00
Payment Every Month$1,110.21
Total of 120 Payments$133,224.60
Total Interest$33,224.60
All Payments and Fees$135,724.60
Mortgage APR Calculator
Real APR: 6.339%
Loan Amount$280,000.00
Down Payment$70,000.00
Monthly Pay (principal & interest)$1,724.01
Total of 360 Payments$620,642.94
Total Interest (P&I)$340,642.94
Points + Fees (upfront)$2,600.00

How to interpret APR results

APR is the interest rate that exactly discounts all future payments (and recurring charges) back to the net cash you receive after upfront costs. It lets you compare loans with different fee structures on an apples-to-apples basis. A lower APR generally means a cheaper loan, but term length, prepayment plans, and PMI/insurancecan change the picture.

  • Short vs. long terms: Shorter terms often show a higher payment but can still have a lower APR because you pay interest for fewer months.
  • Points & fees: Paying more upfront tends to lower the interest rate but raises the breakeven time. Refinance or move early and you may not recover the points.
  • PMI: Mortgage insurance behaves like an extra monthly fee and can push APR higher until it drops off.

How APR is calculated (overview)

We treat the loan from the borrower’s perspective: at time zero you receive the amount financed net of out-of-pocket fees, and you make a stream of equal monthly payments (plus any recurring charges such as PMI). The APR is the internal rate of return (IRR) on those cash flows, annualized as (1 + r_month)¹² − 1. If inputs are incomplete or invalid, the calculator pauses and shows a gentle prompt instead of partial results.

See the math

Payment (amortizing): PMT = i · P / (1 − (1 + i)−n), where P is principal (plus any financed fees), i is effective monthly rate, and n is number of months.

APR (monthly IRR): solve CF₀ = Σt=1..n PMT/(1+i*)ᵗ, where CF₀ = amountFinanced − upfrontFees. Then APR = (1+i*)¹² − 1.

For the mortgage APR, we include points and loan fees upfront and add optional PMI to the monthly outflow.

APR explained: compare loans the way lenders do

Our APR calculators convert interest, fees, and timing into one annualized rate so you can compare offers apples-to-apples. Use the General APR Calculator for personal loans and credit cards, and the Mortgage APR Calculator for home loans with points and closing costs. If you also want a quick payment view, see our loan calculator or the mortgage calculator; to evaluate replacing an existing loan, try the refinance calculator.

Understanding APR

What is APR?

APR (Annual Percentage Rate) is the internal rate of return (IRR) on your real cash flows: what you receive up front vs. what you repay over time including required fees. It annualizes the total borrowing cost so different loan structures can be compared on one scale.

What’s included in APR?

  • Nominal interest charges from your payment schedule.
  • Financed or upfront lender fees (e.g., origination, underwriting, points).
  • Required add-ons tied to the loan (e.g., some mortgage insurance items when applicable).

Items not universally included: late fees, optional warranties/add-ons, and independent third-party costs that are not required to obtain the loan. Always review disclosures.

APR vs. interest rate

The interest rate sets your scheduled payment. APR goes further by spreading required fees across the loan’s life. When fees are non-trivial or the term is long, APR is usually higher than the note rate.

General APR Calculator

How to use the calculator

  1. Enter the amount you actually receive (net of upfront fees if they’re withheld).
  2. Add financed fees to the principal if they’re rolled into the loan.
  3. Set the term and payment schedule; include any balloon or annual fees if applicable.
  4. The tool solves the IRR and annualizes it to produce APR.

For quick monthly payments without fees, use the loan calculator; to compare apples-to-apples when fees differ, use APR.

Example: personal loan APR

You borrow $10,000 for 36 months at 9.99% with a 5% origination fee withheld ($500). You receive $9,500 but make payments on $10,000. The payment is about $322. APR solves to ~13.1%, higher than the note rate because you effectively paid interest on money you didn’t receive.

Example: credit card APR

A card advertises 24.99% APR on purchases. If there’s an annual fee that is required to hold the account, the true APR is slightly higher than 24.99% when that fee is included in the cash-flow math.

Mortgage APR Calculator

How to use the mortgage calculator

Enter price, down payment, loan term, note rate, and itemized closing costs (points, origination, lender fees, prepaid interest when applicable). The tool computes APR by combining the payment stream with your upfront costs. For a payment-only view with taxes/insurance, see the mortgage calculator. If you’re considering replacing an existing loan, pair APR analysis with our refinance calculator.

Mortgage APR vs. note rate

Mortgages often trade points for a lower note rate. APR converts that trade into one number. If you expect to sell or refinance before breakeven, a higher note rate with lower upfront fees may yield a lower total cost even if its APR is slightly higher.

What fees are included in mortgage APR?

  • Discount points and lender origination/underwriting fees.
  • Some mortgage insurance and prepaid interest amounts (jurisdiction-dependent).
  • Third-party fees required to obtain the loan may be included depending on rules.

Fees that are optional or unrelated to obtaining credit (owner’s title, certain escrows, home inspection) are typically excluded from APR disclosures.

Example: 30-year fixed APR

Suppose a $400,000 loan at 6.50% has $6,000 in lender fees and 1.0 point ($4,000). The payment on $400,000 for 30 years is about $2,528 (principal+interest). Solving the IRR on the net proceeds ($390,000 if all fees are paid upfront) vs. the payment stream yields an APR near 6.82%. If you instead choose 6.875% with zero points and $2,000 fees, the APR may drop if you won’t keep the loan long enough to recoup points.

How APR affects your loan

The impact of fees and points

Upfront fees raise APR, especially on shorter terms where there are fewer payments to amortize them. Points lower the note rate but increase APR unless you keep the loan long enough to hit the breakeven month.

How to use APR to compare loans

  • Use APR when fees differ across offers.
  • Use payment, taxes, and insurance to size your budget alongside APR.
  • For mortgages, check the breakeven on points and consider your horizon (move/refi risk).

What is a “good” APR?

“Good” depends on credit, term, collateral, and market rates. Compare multiple quotes the same day and evaluate APR, total interest, and cash due at closing. Use APR to narrow options, then choose the structure that best fits your timeline and cash-flow needs.

Frequently Asked Questions (FAQ)

Is my APR fixed or variable?
APR is a snapshot when you open the account. On variable-rate products, payments change with the index; the disclosed APR reflects terms at origination and may not predict future changes.
How often does APR change?
For fixed-rate loans, APR doesn’t change after closing. For variable-rate loans and credit cards, the underlying index can change monthly or quarterly per the agreement.
Are all lender fees included in APR?
Most required finance charges are included, but rules vary by product and jurisdiction. Optional services and some third-party costs are typically excluded; always review your disclosures.
APR vs. interest rate-what’s the difference?
Interest rate prices the loan’s finance charge on the outstanding balance. APR rolls in certain fees (and points) so you can compare total cost.
Do all fees count toward APR?
Regulations vary; generally lender finance charges do, while third-party charges (e.g., taxes, title) may not. This tool is educational and includes the fields you enter.
When do points pay off?
Points reduce the rate but require upfront cash. They pay off if you keep the loan long enough for monthly savings to exceed the cost.
Is a shorter loan always a lower APR?
Often, but not always-fees, rate changes, and insurance can swing results.
How does PMI affect APR?
PMI acts like an extra monthly fee. If present for many months, it can materially increase APR.
Will prepaying principal change APR?
APR is computed for the scheduled payments. Prepaying changes the realized cost; use the mortgage payoff tool to model that scenario.

Educational estimates only; not financial advice. Confirm fee treatment and APR disclosures with your lender.

Use cases & examples: APR

Example 1 - General APR with fees

Borrow $20,000 at 8% nominal (monthly), 48 months, with $400 upfront and $0 financed fees. Payment ≈ $488.26. Solving the monthly IRR on the cash flow gives APR ≈ 8.87%.

Example 2 - Mortgage with points

$400,000 home, 20% down, 30 years at 6.25%, 1 point ($3,200) + $1,200 fees, no PMI. Monthly ≈ $1,970. APR rises slightly above the note rate because of the upfront costs.

Example 3 - PMI impact

$350,000 home, 10% down, 30 years at 6.5%, $2,000 fees, 0.6% PMI/year. The PMI behaves like a monthly surcharge and can add ~0.2–0.4 percentage points to APR depending on duration.

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