APR Calculator
Find the true APR of a loan once fees and discount points are included.
Results update as you type.
About this calculator
The advertised interest rate on a loan hides its real cost, and this APR calculator reveals it. The annual percentage rate (APR) folds upfront fees and discount points into a single yearly rate by treating them as reducing the money you actually receive, then finding the rate that equates your payments to that smaller net amount. It solves for the APR iteratively so you can compare loans with different fee structures on an equal footing.
The note rate sets your payment; the APR reflects that you get less cash up front because of fees. For example, a 200,000 loan at a 6% note rate over 30 years still has the same monthly payment, but 3,000 in fees means you effectively receive only 197,000 — so the true APR comes out modestly above 6%. Adding discount points, each costing 1% of the loan, pushes the APR higher still.
Use it to see past a tempting headline rate to a loan’s real cost and to compare offers where one has a lower rate but higher fees. Because APR spreads those upfront costs across the full term, it always equals or exceeds the note rate and is the fairer number for shopping loans.
Frequently asked questions
What is the difference between APR and interest rate?
The interest rate is what accrues on the balance; the APR also spreads upfront fees and points across the loan, so it is always equal to or higher than the note rate. APR is the fairer number for comparing loan offers.
How are discount points handled?
Each point costs 1% of the loan amount, paid at closing, and is added to your fees. Because you pay them upfront but still repay the full loan, they raise the effective rate — which is exactly what the APR captures.
Why is the APR higher than the interest rate?
Because the APR spreads upfront fees and points across the loan while the payment is still based on the full loan amount. You effectively borrow less than you repay against, so the true yearly cost — the APR — sits above the note rate whenever fees are charged.
Are discount points worth buying?
Points lower your note rate in exchange for cash now, which raises the APR upfront but can reduce lifetime interest if you keep the loan long enough to recoup the cost. Add points here to see how they change both the payment and the effective APR.
Does a lower APR always mean a cheaper loan?
Usually, but not always — APR assumes you hold the loan for its full term. If you plan to sell or refinance early, a loan with a higher APR but lower upfront fees can actually cost you less, so weigh the fee total against how long you will keep it.
What fees are included in the APR?
This calculator folds in the fees and closing costs you enter plus any discount points into the amount you effectively receive. Real-world APR definitions vary on exactly which charges count, so a lender’s quoted APR may differ slightly from this estimate.
API — use this calculator from code
Call this calculator as a free JSON endpoint — no key required. Send the field values below as query parameters or JSON. Read the full API docs →
Endpoint
GET https://calculator.free/api/v1/apr/curl
curl "https://calculator.free/api/v1/apr/?amount=200000&rate=6&years=30&fees=3000"JavaScript fetch()
const r = await fetch(
"https://calculator.free/api/v1/apr/?" + new URLSearchParams({
"amount": "200000",
"rate": "6",
"years": "30",
"fees": "3000"
}));
const data = await r.json();
console.log(data.results);Results are estimates for general guidance only, not financial, medical or tax advice.