APR Calculator
The APR captures the true annual cost of borrowing by folding fees in with interest — so it's the fair way to compare loan and card offers. This estimates it from the finance charge.
Your details
- Total finance charge
- $150.00
Interest vs fees
- Interest
- $100.0067%
- Fees
- $50.0033%
Formula
APR ≈ (total interest + fees) ÷ amount borrowed ÷ years, expressed as a percentage. Because it includes fees, APR is usually a bit higher than the quoted interest rate.
How it works
Two loans can share the same interest rate but very different APRs once fees are counted. Comparing by APR — not the headline rate — is how you spot the genuinely cheaper offer.
Frequently asked questions
What's the difference between APR and interest rate?⌄
The interest rate is the cost of borrowing the principal. APR also includes most fees, so it reflects the total cost and is better for comparing offers.
Is a lower APR always better?⌄
Generally yes for the borrower, all else equal — a lower APR means a lower total cost of credit. Always compare loans of the same term and type.
Is this the exact APR?⌄
It's a transparent approximation using the total finance charge. Lender-disclosed APR on amortizing loans uses a more precise cash-flow method, but this is close for comparison.
Sources & methodology
Simple finance-charge APR = (interest + fees) ÷ principal ÷ years. Amortizing-loan APR uses a more precise method.
- •CFPB — APR — CFPB
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