APR calculator.
The interest rate is only half the story. Add the fees and the APR shows the real yearly cost of a loan, so you can compare offers on equal terms.
Loan and fees
LiveAPR folds your fees into the rate. With zero fees the APR equals your interest rate; fees push it higher.
APR
6.14%
on a $200,000 loan
An estimate for comparison, not a loan offer or financial advice. Calculations run in your browser; nothing you enter is stored.
How it works
Rate plus fees, in one number
The APR, or annual percentage rate, takes the interest rate and folds in the upfront fees, then expresses the whole cost of borrowing as a single yearly percentage. It is the number lenders must show so you can compare loans fairly.
A $200,000 loan at 6% over 30 years with $3,000 of fees has a monthly payment set by the rate, but an APR a little above 6% because the fees raise the true cost.
Reference
How fees lift the APR.
A $200,000 loan at 6% over 30 years, with different fee totals.
| Fees | APR |
|---|---|
| $0 | 6.00% |
| $1,000 | 6.05% |
| $2,000 | 6.09% |
| $3,000 | 6.14% |
| $5,000 | 6.24% |
The full guide
The complete guide to APR.
What APR is, how it differs from the interest rate, and why it is the number to compare.
What is APR?
APR stands for annual percentage rate. It is the yearly cost of borrowing money expressed as a percentage, including both the interest rate and most of the upfront fees rolled in. Because it captures more than the rate alone, it is a fairer way to compare loans.
Lenders are generally required to disclose the APR, which makes it the standard yardstick for credit cards, mortgages and personal loans.
APR versus interest rate
The interest rate is the cost of borrowing the principal alone. The APR adds the fees, so it is usually a little higher than the rate. Two loans can share the same rate but have very different APRs once fees are counted.
When you compare offers, line up the APRs rather than the headline rates, because the APR is what reflects the real cost.
How APR is calculated
The lender works out the regular payment from the loan amount and the interest rate, then finds the single rate that makes those payments equal the amount you actually receive after fees. That rate, annualised, is the APR.
Because fees reduce the money you get while the payments stay the same, the APR lands above the note rate whenever fees apply.
What APR does not include
APR is broad but not total. It usually leaves out costs that are optional or vary by borrower, and it assumes you keep the loan for its full term. Pay a loan off early and the effective cost of the fees, and so the real APR, can be higher.
Use APR as the main comparison number, but also look at the total interest and the fees in cash terms before you decide.
The formula
The real
cost.
The rate prices the loan; the APR adds the fees and shows the true yearly cost, which is the number to compare.
Try the loan calculator ›# APR with fees
payment = from amount & rate
APR solves: amount − fees = present value(payment)
# worked example
$200,000, 6%, 30y, $3,000 fees
→ APR 6.14%Questions
APR questions.
What is APR?
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APR, the annual percentage rate, is the yearly cost of a loan as a percentage, including the interest rate plus most upfront fees. It lets you compare loans on equal terms.
What is the difference between APR and interest rate?
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The interest rate is the cost of the principal alone. APR adds the fees, so it is usually higher. Compare APRs, not rates, to see the true cost.
Is a lower APR always better?
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Usually yes, because a lower APR means a lower overall cost. But check the fees and total interest too, and consider how long you will keep the loan.
Does APR include all costs?
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Most upfront fees, but not everything. Optional charges may be excluded, and APR assumes you keep the loan for its full term, so paying off early changes the real cost.
Is this APR calculator free?
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Yes. It is completely free with no sign-up, and every calculation runs locally in your browser, so nothing you enter is stored or sent anywhere.
About the developer
Jean Borg
Jean builds and maintains every calculator on freecalculators.pro from Malta, with a focus on tools that are fast, free and show their working. The APR calculator uses standard finance maths and is provided for comparison and education, not as a loan offer or financial advice.