Free APR Calculator Online
Use this free APR calculator to find the true annual percentage rate on any loan. Enter your loan amount, stated interest rate, fees, and term to see the real cost of borrowing — and compare offers from different lenders side by side.
True APR
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How This APR Calculator Works
This APR calculator takes your loan amount, stated interest rate, total fees, and loan term to compute the effective annual cost of borrowing. It adds all fees to the loan cost, then solves for the rate that equates the present value of all payments to the net amount you actually receive (loan amount minus fees).
For example, a $250,000 mortgage at 6.25% interest with $7,500 in origination fees and closing costs over 30 years has a monthly payment of $1,539. But because you effectively only received $242,500 (after fees), the APR calculator shows the true annual cost is 6.52% — not 6.25%.
This difference matters when comparing lenders. The APR calculator levels the playing field by converting every offer into a single comparable number that accounts for both rate and fees. A lower APR always means a lower total cost — assuming you hold the loan to maturity.
Rate vs. APR: Real-World Examples
The lowest rate does not always mean the lowest APR. Use the APR calculator to compare your specific loan offers and find the true cheapest option.
3 Things to Know About APR
Fees Matter
A loan with a 6.0% rate and $10,000 in fees can cost more than one at 6.5% with zero fees — especially if you sell or refinance within 5-7 years. The APR calculator reveals whether paying upfront fees makes financial sense for your specific holding period. Always run the numbers before committing.
Time Horizon
APR assumes you keep the loan for its full term. If you plan to sell in 5 years, a higher-rate loan with lower fees might actually save money compared to a lower-rate loan with hefty closing costs. The break-even on buying one discount point is typically 4-6 years — shorter stays favor lower fees.
Compare Apples
Only compare APRs for loans with the same term length. A 15-year loan at 5.75% APR and a 30-year loan at 6.25% APR are not directly comparable — the 15-year loan has higher payments but far less total interest. Use the APR calculator to evaluate loans of the same type and term for an accurate comparison.
Frequently Asked Questions
Disclaimer: This APR calculator is for educational purposes only. APR calculations assume the loan is held to maturity. Actual APR disclosures from lenders may differ based on which fees are included per federal regulations (TILA). Consult your lender's official Loan Estimate for the legally mandated APR disclosure.
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