APR Calculator
Find the true APR of a loan including fees, convert a monthly interest rate to APR, and see APR vs APY — free, with worked examples.
Updated October 2026
This is an estimate for general information only and is not financial, tax or investment advice. Figures may differ from a lender or advisor.
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This APR calculator shows the true annual percentage rate on a loan once upfront fees are taken into account. The advertised, or nominal, rate only reflects the interest charged, but fees reduce the money you actually receive — so the effective cost of borrowing is higher. Enter the loan amount, the nominal rate, the term and any upfront fees to see the real APR.
The calculation first works out your fixed monthly payment from the nominal rate using the standard amortization formula. It then finds the interest rate that equates the amount you actually receive after fees to that stream of payments, and expresses it as an annual rate. When there are no fees, the true APR equals the nominal rate.
How to work out APR: worked examples
The APR questions people ask most, worked step by step:
- Monthly interest rate to APR: multiply by 12. A 1.5% monthly rate is 1.5 × 12 = 18% APR. Going the other way, a 24% APR is 24 ÷ 12 = 2% per month.
- APR vs APY: APR ignores compounding, APY includes it. That same 1.5% a month compounds to (1.015¹² − 1) × 100 ≈ 19.56% APY, and a 6% APR compounded monthly is about 6.17% APY. Lenders quote APR; savings accounts quote APY.
- APR from a monthly payment: a $15,000 loan repaid at $350 a month for 48 months costs $16,800 in total. Solving for the rate that makes 48 payments of $350 worth $15,000 today gives about 0.472% a month — an APR of roughly 5.67%. There is no simple formula; it is found by trial (iteration), which is what the calculator does.
- How fees raise the APR: $10,000 at 8% for 5 years is $202.76 a month. With a $300 origination fee you only receive $9,700 but still make the same payments, so the true APR is about 9.30% — 1.3 points above the advertised rate.
How to use it
- 1Enter the loan amount and choose your currency.
- 2Type the nominal interest rate (the advertised APR) as a percentage.
- 3Set the term in years.
- 4Add any upfront fees, then read the true APR, monthly payment and total paid.
Frequently asked questions
What is the difference between nominal rate and APR?+
The nominal rate is the stated interest rate on the loan. The APR (annual percentage rate) folds in upfront fees, so it reflects the true yearly cost of borrowing. When a loan has fees, its APR is higher than its nominal rate.
How is the true APR calculated?+
The calculator finds the monthly payment from the nominal rate, then solves for the interest rate that makes the net amount you receive (loan amount minus fees) equal to the present value of those payments. That monthly rate is multiplied by 12 to give the annual APR.
Why does adding fees raise the APR?+
Fees mean you receive less money than the loan's face value but still repay the full amount plus interest. Spreading that extra cost over the loan term raises the effective interest rate, which is what the APR captures.
How do I convert a monthly interest rate to APR?+
Multiply the monthly rate by 12. A 1.5% monthly rate is an 18% APR, and a 0.5% monthly rate is a 6% APR. To go from APR to a monthly rate, divide by 12 — a 24% APR is 2% per month.
What is the difference between APR and APY?+
APR is the simple yearly rate (monthly rate × 12) and does not include compounding. APY (annual percentage yield) includes compounding, so it is always equal to or higher than the APR. A 6% APR compounded monthly equals about a 6.17% APY. Loans are usually quoted in APR, savings accounts in APY.
How do I work out the APR from a monthly payment?+
You need the amount borrowed, the monthly payment and the number of payments. The APR is the rate at which those payments, discounted back to today, equal the amount you received. There is no closed-form formula, so it is solved by iteration — for example, $15,000 repaid at $350 a month for 48 months works out to about a 5.67% APR.
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