APR and real cost calculator
Estimate APR including interest, origination fees, upfront expenses and monthly mandatory costs to compare the real cost of a loan.
From nominal rate to real cost
APR is the rate that equates net proceeds with the present value of every entered monthly payment.
Total real cost
- Interest
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- Upfront charges
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- Recurring costs
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- Total real cost
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- Total paid
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- Financed principal
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- Final payment
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APR–rate difference: —
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Cash received initially: —
Modelled monthly payment: —
How APR is estimated
The schedule uses principal, nominal rate and term and may include principal grace and a balloon. The fee is deducted upfront or added to financed principal as selected.
A monthly rate is then solved so those proceeds equal the present value of the payment plus recurring costs; the rate is compounded over twelve months.
Advanced options provide a closer representation of the contract; keep their defaults when they do not apply.
Equation used
Net proceeds = Σ monthly outflow / (1+r)^t. Estimated APR = (1+r)¹² − 1. Total cost includes interest, upfront and recurring charges.
Example
For 20,000, a 7% nominal rate, 60 months, a 1% fee, 150 upfront and 5 monthly, APR exceeds the nominal rate because proceeds are lower and payments are higher.
Frequently asked questions
Why is APR above the nominal rate?
It reflects the timing and amount of charges as well as interest.
Should insurance be included?
Include it when mandatory for the simulated terms and its cost is known.
What about a financed fee?
Enable “Finance fee”: it is added to financed principal and is not deducted from initial proceeds.
Can it model a variable rate?
Only as a scenario keeping the entered rate constant.
Is this the contractual APR?
No. It is an independent estimate; contractual documentation prevails.