What this calculator does
APR helps compare borrowing by including interest and certain fees in one annual rate. This calculator estimates APR from the cash received and the payments made.
Formula used
The calculator solves for the monthly rate that makes the present value of all payments equal to the amount received after upfront fees, then annualises that monthly rate.
How to read the result
APR is useful for comparison, but lender calculations can include specific fee rules and timing assumptions. Use official lender figures for agreements.
Assumptions
- Assumes equal monthly payments.
- Treats upfront fees as reducing the amount received.
- Does not model irregular payments or optional charges.
Sources and checks
This calculator uses a standard public formula. Where rules or thresholds can change, source links are listed on the relevant page.
Frequently asked questions
Why can APR be higher than the interest rate?
Fees and timing can raise the effective annual cost, especially on shorter loans.