Annual percentage rate (APR) reflects the yearly cost of borrowing including interest and certain fees. This calculator provides an APR estimate from loan amount and finance charges.
How to use this calculator
- Enter the loan amount financed.
- Enter total finance charges (interest plus fees).
- Enter the loan term in months.
- Review estimated APR and total cost.
Formula
APR is approximated using a common installment-loan formula that relates finance charges, loan amount, and number of monthly payments.
Example
A $20,000 loan with $3,000 in finance charges over 60 months has an estimated APR of about 5.9% and total cost of $23,000.
Frequently asked questions
- Is this APR exact?
- This is an estimate. Lenders disclose official APR using regulated methods that may include additional fees.
- What counts as a finance charge?
- Include interest and lender fees included in the loan. Exclude optional products unless they are part of required financing.